Yes, Small Businesses Need Cyber Insurance Too
Businesses of all sizes rely on computer networks to operate. While the digital age has brought numerous benefits, it also brings new and evolving risks as cyber criminals work to steal data and disrupt businesses.
Small businesses are not exempt from this trend. In fact, they are in many ways more vulnerable than the large corporations we see in the media every time there is a major breach. For this reason, cyber insurance for small business is crucial for a robust cyber risk mitigation program. At ProWriters, our cyber experts can help you sell competitive cyber insurance packages and find the right policy for your clients.
Why Small Businesses Need Insurance
We hear a lot from small businesses that think they won’t ever have to deal with a cyber breach. It’s a common perception among small business owners: the idea that “it will never happen to me.”
Unfortunately, the data just doesn’t back this up.
Small businesses are actually more likely to be targeted by cyber criminals. Smaller businesses are the target of choice for hackers because they’re seen as less secure and easier to exploit. This is why more than 70% of cyber attacks target small businesses, not large corporations. The large-scale data breaches that we see in the news are just the tip of the iceberg. For every large corporation that is breached, thousands of small businesses are being targeted. It’s estimated there’s a hacking attempt every 39 seconds, and small businesses bear the brunt of that assault.
If a company handles sensitive data, such as healthcare or credit card information, then there is an obvious risk with respect to a cyber breach. But even businesses that do not handle this kind of information are at risk. At the end of the day, cyber crime is about money, and hackers can make money no matter what data their target has.
For instance, a hacker can hold a business’ data hostage with ransomware and demand payment. If the business doesn’t pay, the hacker destroys the data. That kind of attack happens regularly and has nothing to do with the data a business has. Hackers in this instance are hoping to profit from their targets’ dependence on the data they have taken. They may never use it themselves—but if it gets destroyed, that can be devastating to the affected business.
Many Small Businesses Are Unprepared
Cyber insurance is crucial for small businesses because many of them are unprepared for a breach. According to a report from the Insurance Information Institute, only 14% of small businesses feel very confident in their cyber risk mitigation measures. When you consider that nearly half of all small businesses experienced a cyber attack in the last year, there is a major gap between what companies are prepared for and what they will likely face.
This is especially apparent for companies that handle any type of electronic payments. These businesses are supposed to be in compliance with the Payment Card Industry Data Security Standard (PCI DSS.) But a study published in the Journal of Cyber Security and Information Systems found that PCI compliance does not necessarily mean a company is prepared for a cyber attack.
Only 29% of businesses were found to be compliant a year after being certified. What’s more, businesses that are compliant have still experienced major data breaches. Target is just one prominent example; the company was certified PCI compliant just weeks before hackers stole data affecting 41 million customers. PCI compliance is not the same as protection, and many businesses that meet this minimum standard are still unprepared for an attack.
Cyber insurance is a powerful tool that empowers businesses to be proactive about their cybersecurity and mitigate the risks before it’s too late.
ProWriters Can Help
Cyber insurance is more comprehensive than ever before and covers the costs associated with a data breach. The right policy will bring peace of mind to your clients as it covers costs related to:
- Customer notification
- Regulatory fines and penalties
- Forensic IT investigations
- Breach of contract and negligence claims
- Business interruption costs
- Ransomware payments or the costs to rebuild your network
ProWriters gives you the tools you need with our more than 20 years of expertise and a powerful online quote comparison platform. Our Cyber IQ Comparative Rate Portal allows you to compare quotes from multiple top carriers in just minutes, while our comprehensive Cyber Liability Insurance program offers broad coverage designed to cover a wide range of exposures.
When it comes to cyber insurance for small business, ProWriters is leading the way. For more information about cyber insurance for small business or to speak with one of our cyber experts, schedule a call with us today!