Cyber Insurance As A Risk Mitigation Strategy

Are you a business owner or contractor storing your clients, suppliers, or employees’ information online?

Or perhaps you own an online store where customers can enter their credit card details to buy your products or book your services?

Maybe your employees are allowed to work from home every now and then?

Then, you should be considering cyber insurance.

Working in a digital environment has a lot of perks, such as increasing your business visibility and allowing for a better work-life balance, but it also comes with a significant drawback; the risk of cyberattacks!

Fortunately, cyber insurance is here to help.

What Is Cyber Insurance?

In the online age, storing data on the cloud and using internet-based devices exposes businesses to cyber incidents. A cyber insurance policy is a policy designed to protect your business against these incidents. 

Depending on the provider and the policy you choose, cyber insurance might cover:

• Financial losses incurred by a data breach
• Reputational risk management as a result of a data breach
• Fines due to a data breach
• Forensic investigations
• Trademark and copyright infringement
• Loss or damage to your data, records, and IT systems
• Losses due to business interruptions linked to a cyber incident
• Hire of mediators and negotiators due to a ransomware attack

Why Is Cyber Insurance A Critical Component To A Risk Mitigation Strategy?

Cybercrime in Australia is on the rise. Unfortunately, half of the Australian businesses are ill-prepared in the event of a cyber attack. That’s because two in five Australian businesses don’t invest in cyber security. 

In the same way you should invest in a disaster recovery plan as part of a risk mitigation strategy to protect your business in the event of a fire, storm, flooding, or power outage, you need to protect your business against cyber threats. And while firewalls and backups are non negotiable, so is cyber insurance.

Here are some powerful stats revealing the importance of cyber insurance as part of a risk mitigation strategy:

• There were over 67,000 cyber incidents reported in Australia in 2021, an increase of 13% YoY.
• The average data breach cost for Australian businesses is $3.3 million!
• Data breach reports have increased by 712% in Australia between 2018 and 2021.
• The average cost of cyber incidents (other than data breach) on Australian businesses is over $276,000.
• 43% of cyberattacks in Australia affect small businesses.
• 92% of Australian small businesses were hit by a phishing attack in 2021. 
• 80% of Australian companies were affected by a ransomware attack in 2021.
• 67% of businesses don’t use multi-factor authentication (MFA). Businesses that do are 99.9% less likely to experience a data breach.

The rise of remote working and online communications is contributing to the increased risks of cyber incidents for businesses. That’s why cyber insurance has become vital to any business using digital communication.

Where To Find The Best Cyber Insurance In Australia?

At upcover, we’re always following trends and adjusting our services to ever-changing small business owners’ needs. That’s why we’ve recently launched our Cyber & Privacy Liability Insurance. 

Our comprehensive policy will cover you for a wide range of cyber threats, including cyber extortion. It will also pay for the costs associated with the interruption of business incurred by a cyber incident. Lastly, you’ll be covered for the costs of restoring your data and systems. 

Our friendly and knowledgeable team is here to help, so don’t hesitate to get in touch if you have any questions about our policy.