Unfortunately, the world of cyber crime isn’t going away anytime soon. While no one is truly safe from cyber crime, business owners are especially at risk and often have even more to lose. Because of this, it’s important for every entrepreneur to consider his or her cyber risks and protect their business with a cyber liability insurance policy.
How serious is cyber crime? It is such a concern that the
5 Trends Increasing the Need for Cyber Liability Insurance
Despite the fact that cyber crime continues to be on the rise, the types of crimes that are committed can be summed up into a few categories. Knowing what risks you and your business are exposed to can help you safeguard your business and your customers, too. Below are the five most common types of cyber crimes.
#1. Data Breaches
Increasingly more companies are moving to store both company and customer information digitally. In doing so, they increase their vulnerability to cyber hackers who thrive on stealing information. Despite the fact that hackers like to go after large corporations, who have a wealth of customer information stored in their systems, small business owners may be subject to data breaches, too. Always keep your security programs up to date to help prevent this type of cyber crime.
#2. Network Security
Even if you don’t save sensitive company or customer information on your own servers, your business may still be at risk. Cyber hackers frequently target large networks since doing so can let them access more information at once. This is a problem for businesses that store sensitive information on a cloud, or rely on an internet-based third party for daily business operations.
Forever in pursuit ripping off innocent people, hackers are always looking for innovative ways to steal information. Because of this, ransomware is the latest threat in cyber hacking. How does it work? The most common form of this new malicious software blocks access to your computer system and demands payment in order to unlock it.
Some reports state that ransomware is even becoming more common on mobile devices. You can prevent this type of attack by not opening email attachments from unknown senders and avoiding websites that may not be trustworthy.
#4. Attacks on Payment Systems
The last few years have seen the advent of multiple types of mobile-based payment systems such as the square reader, and Apple Pay. Unfortunately, these too have been targeted cyber criminals. Furthermore, Trend Micro expects mobile commerce to continue to be one of the hottest targets for cyber attacks. For entrepreneurs who may use mobile payment systems with their customers, this could be bad news.
#5. Smart Spam
While many of us tend to think of spam as a bit of a joke, the newest form of it is anything but a laughing matter. New “smart spam” works differently than the lazy spam email of the past. In this current iteration, you could be exposed to APT’s – advanced persistent threats.
The newest form of spam uses psychological manipulation in order to elicit the desired action from a victim. Usually, victims are tricked into revealing personal confidential information or performing actions that make them vulnerable to hackers. Before you give away sensitive personal information, always double check the source making the request. Often, spammers get away with their ruse because victims didn’t make any effort to verify where their information was going.
Consequences of Cyber Crime
In addition to upsetting business owners who have been attacked, customers feel the sting of cyber crime as well. Afterwards, there are often feelings of hurt and distrust towards the business that was attacked, since it may be assumed that the business owner was careless with customer information. If you find your company has been the subject of a cyber attack that affects your customers or their sensitive information you had stored, be sure to take steps to alleviate your customers’ fears. Let them know exactly how the attack occurred and reduce your liability. Then, make a point to discuss what steps are being taken to avoid future attacks.
What is Cyber Liability Insurance?
If you have done everything in your ability to reduce your exposure to both known and unknown cyber crimes, the next best step is to obtain cyber liability insurance. Many business owner insurance policies (BOP) offer some coverage, but depending on your level of exposure, you may want to talk to a qualified insurance agent about getting more coverage, if possible. For some businesses, it could be necessary to purchase another policy with more coverage.
As cyber crime becomes more problematic for business owners and the general public alike, the insurance industry is working hard to combat the damage. Insurers are still learning about the type of cyber crimes that exist and what kinds of exposures increase the risk of attacks. Since cyber crime is constantly evolving, the insurers who handle the effects must evolve as well. Because of this, you should make sure that your level of coverage on your policy suits your needs.
Also, be sure to inform your insurer of any significant changes within your business, as it may affect your level of risk exposure. If your policy is reviewed on a regular basis and updated where needed, you will be taking excellent steps towards protecting your business.
Until someone discovers a way to completely rid the world of cyber crime, the best thing you can do is protect yourself. Cyber criminals are no respecters of persons and will attack anyone at any time if they are even the least bit vulnerable. Protect yourself and your business and you’ll be taking strides in protecting your customers as well. Obtaining cyber liability insurance is just one step in that process, but it isn’t optional. If you want to protect your business, cyber liability insurance is an absolute necessity.
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