Does small business need cyber insurance?

In just 3 months there were over 13,000 cybercrime incidents reported to the Australia Centre for Cyber Security (ACSC). This equates to one case every 10 minutes. Cyber-attacks are an extremely lucrative form of criminal activity, which is fueling a dramatic increase in the number of attacks on Australian businesses of all sizes.

• 43% of reported data breaches involve small businesses (Verizon, 2019).
• The average financial loss per incident in Australia is $6,000 (ACSC, 2019).
• Nearly 50% of businesses do not spend more than $500 on IT security annually (ACSC, 2019).

Cost of cyber attacks on small business

There are a number of factors that may be impacted due to a cyber attack, including:

• The cost of ceasing operations
• Ransom payments
• Data restoration and hardware replacement
• Cost to investigate
• Third party damages
• Legal defence costs
• Statutory fines and penalties
• Brand and reputational repair

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Cyber insurance is designed to help protect your business from the financial impact of a computer hacking or a data breach. This risk exposure is not covered by a traditional business insurance policy. We’re part of Community Broker Network, and they’ve prepared a good piece on cyber risk and insurance, and what’s typically included here.