The importance of Security & Cyber Insurance

By July 20, 2018Insights

It is no longer a question of IF your business will suffer a cyber-attack or data breach, but rather a question of WHEN. Cybercrime occurs daily in Australia, disabling businesses, compromising their systems and holding critical data to ransom. Cybercrime is disguised in many different forms, some of the more serious being ransomware through phishing and credential harvesting malware. An attack or breach exposes confidential personally identifiable information and can result in the loss of intellectual property. This can have significant implications on individuals and businesses through financial loss, regulatory fines and penalties, remediation costs, litigation and especially damage to your business’s brand and reputation.

According to the Australian Criminal Intelligence Commission, due to Australia’s relative wealth and use of online technology such as social media, online banking and government services it has become an attractive target for serious and organised crime syndicates, especially offshore cybercriminals.  I recently came across a quote justifying our online battle with cybercriminals: “Bank robberies are old news. Today heists happen online”. As a result of these growing cyber-attacks the Australian Government passed new Notifiable Data Breach Laws in February 2018 which requires businesses to notify the Australian Information Commissioner of any eligible data breaches. Failure to notify and comply can attract fines up to $1.8 million for businesses and $360,000 for individuals. More information can be found on OAIC. A recent survey by the Australian Government Initiative – Stay Smart Online has revealed that the average cost of a cyber-attack on a business is $276,323 and it takes an average 23 days to resolve an attack.

As the threat associated with cybercrime evolves, so do the methods of combatting them.  The range of preventative steps are now supported by cyber insurance products that help to mitigate the financial and technological damage caused by an attack.  Few organisations have included cyber insurance in their business insurances portfolio, but it should now be seen as a priority.  Cyber insurance offers businesses assurance that in the event where a cyber-attack cannot be prevented that they are covered against the costs that may result from the cyber-attack. Here are six reasons to consider cyber insurance for your business:

  1. It complements your IT security

You must protect your business by having a strong IT security posture in place and if you unsure whether your systems meet the industry best practice guidelines, contact Aliva now to discuss our Cyber Aware Security Services. Cyber Insurance complements security by providing cover for the financial cost you would otherwise incur if you suffer a cyber breach or threat despite your preventative measures.

  1. Compensation from Australia’s fastest growing fraud threat.

Unfortunately, the best protected systems can still be vulnerable because it’s humans that use them.  Social Engineering Fraud, Business Email Compromise, CEO Fraud, Imposter email, there are lots of names, but the premise is the same. Employees are contacted by criminals who use sophisticated tactics to impersonate a trusted party or person.

They then use emotional triggers to elicit an action by the employee which usually results in a direct financial loss. Put simply, they gain trust and trick staff into transferring large amounts of money out of the business.

  1. It protects your revenue

Whilst you understand and rectify the cyber breach or threat, very often your ability to trade is diminished.  Cyber insurance protects your revenue, reimbursing you so that you’re not worse off as result of the incident.

  1. It protects you if you are sued.

Your company could face legal action from third parties for various reasons including allegations you failed to properly protect their sensitive data or due to the inability of others to access data on your system due to a breach. Cyber insurance covers damages, defence costs and regulatory fines.

  1. You have expert help if you are attacked.

Cyber-attacks are stressful and there is a lot to manage. Quality cyber insurance solutions include Emergency Response capability for you to access 24/7. This provides you with legal, IT security & forensic and Public Relations support. In your hour of need, these experienced specialists will work with your IT services provider to get your business back up and running.

  1. Business insurance policies aren’t adequate and will leave you uninsured

Your business package insurance policy doesn’t cover cyber risks and will leave you uninsured if you suffer a loss. You should consider stand-alone cyber insurance from a specialist provider.

Aliva has partnered with Edmund Insurance, a specialty cyber insurance company, whose products compliment our Cyber Aware Security Services offering by giving policy holders peace of mind to the level of their cover.  The application process to apply for and buy cyber insurance is fast, easy and simple. For more information or to get a quote now CLICK HERE.

By: Andrise Swanepoel, GM Corporate Services

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