Why Small Businesses Need Cyber Insurance

When we hear about hacking groups like Anonymous and Lizard Squad targeting corporate, government and even religious groups, we're grateful it's not us. We believe 'hactivists' only target large, corrupt corporations or hate-spewing organizations. While some hactivists use their talents for good, there are others, (let's refer to them as hackers) who work to threaten, steal and cause harm. The size of your company doesn't matter to a hacker; if you have caught their attention, you are now a target. If your small business manages a lot of your company's affairs online, investing in cyber insurance will be one of the smartest decisions you will have made as CEO or a key decision maker of your business.

What is Cyber Insurance?
In its most general form, cyber insurance is a policy that covers property and liability losses as a direct result of an electronic interference/hack by an unauthorized source.

This includes, but is not limited to:

  • Third party liability for privacy invasion
  • Loss of customer/client personal information
  • Data loss
  • Data breach
  • Cyber extortion
  • Business interruption
  • Computer fraud

As a small business, you probably feel that you and your employees are safe from such losses. Who would go after a small company anyway when there are bigger fish to fry? Hackers don't care; they're going to go after the easiest target. If you don't have the right cybersecurity measures in place, they're going to come after you.

Hacking: By the Numbers
Unlike large corporations who have the money to pay for cybersecurity and to upgrade their network with each new hacker trick, small businesses do not have that same luxury. USA Today reports that a website or computer attack can cost small businesses anywhere from thousands to millions of dollars. In 2013, 44 percent of small businesses experienced a cyber attack. The average cost to make reparations for those cyber infiltrations was $8,700. Most small businesses do not make a profit until after their first year of business, and even then they may only be breaking even.

Small businesses take time to mature. The scary thing is, if you're hit by a cyber attack, your business may not make it out alive. Cyber attacks have grown with 60 percent targeting small to mid-size businesses in 2014. Ask yourself this: if your company were attacked right now, could you afford the thousands of dollars it would cost to try and salvage the business? Plus, 49 percent of all small business owners are in debt.

This is why cyber insurance is such an asset to the small business. Cyber insurance covers the costs of security breaches, helping you to get back to work without delay. At CyberPolicy, we value small businesses, and want to do what we can to help. Visit CyberPolicy.com to see our offerings, and secure your business today.

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