What is a Cyber Risk? Technology is advancing at such an alarming rate and business is more and more reliant on IT systems. The increasing dependence on websites, the internet, social media and physical technology mean that we are exposed to threats that we are sometimes not even aware of.
Therefore any organisation or sole proprietor is at risk through their use of online networks and systems including exposure to hardware and software.
All businesses need to be concerned about their cyber exposure. Even the smallest business is likely to make use of technology, be it monitoring stock, keeping track of finances or a simple website. No business operates in isolation, if a business which you rely upon relies upon technology to service you, you are effectively reliant on that technology too. According to a recent Department of Business Innovation & Skills study, 60% of small businesses had a security breach last year with this figure set to rise.
Managing a data breach and often not knowing how to respond effectively when such an event occurs makes the final cost much higher. For all businesses, absorbing such financial hits can be difficult and they can struggle to recover. The key is to have the plans in place beforehand.
The average cost of an information security incident is currently £60,000 with a reported £27 billion of cyber-crime to the UK compared to £6.6 billion from fire risks.*
Examples of how we can all be affected and what impact Cyber Risks can have on daily life:
The Marketing Consultant
Whilst constructing and developing a client’s website they used several logos and images similar to those which had been copyrighted by another entity.
Legal proceedings commenced with the claimant demanding damages in excess of £1m.
Breach of Copyright cover is available under the Multimedia Insuring Clause.
The company’s IT manager discovered that files had been uploaded onto the company’s servers by an unidentified third party from a ‘phishing’ e-mail which ultimately corrupted their data.
As a result a breach of services/forensic consultant was required to restore the data contained in the damaged files costing £30,000 and an additional £5,000 for employee time which was covered .
High Street Accountant
The accountant discovered that an unauthorised third party had gained access to their servers which contained financial records including high profile celebrities.
A message was then posted stating the information had been encrypted and a threat this would be published in the public domain.
Theft of a senior partner’s lap top containing sensitive personal data whilst parked at junction.
Access was protected by a password but the information not encrypted.
Although the details never appeared in the public domain the company notified their clients costing £50,000.
Cover can be provided across many areas depending on your needs as a business: Hacking, Data Loss, Denial of Service, Infringement of Copyright, Defamation, Invasion of Privacy, Defence Costs of Information Commissioner Investigations, Crisis Management, Data Recovery and Loss of Income (First Party), Data Extortion. Speak to your advisor for a bespoke policy proposal and further information regarding your exposure as a business to these fast changing areas.For advice & guidance on cyber liability, click here