How Proper IT Services Are Necessary For Cyber Insurance Claims

In my last post I have highlighted the need for protection from more and more sophisticated cyber-attacks. Statistics show that 60% of small businesses affected by cyber-attack close within 6 months after an attack, thus the need for making sure that we protect ourselves as much as possible. It’s been noted that phishing attacks have increased by 600% since February 2020 and they, quite often, succeed in breaking existing security measures, especially when these measures are not being updated on regular bases (in Canada, nearly a quarter of small businesses have experienced a cyber-attack), The problem has been greatly exacerbated by pandemic.

In today’s world, more and more small and micro businesses include cyber insurance with liability insurance. However, it is not sufficient without proper IT care related to cyber security. More and more insurance companies require proper maintenance of computer system in processing cyber security claims. With ransom demands reaching $50 million it is not a big surprise for the insurance providers to mitigate their risks. That’s why it is more and more important to pay close attention to maintenance and security of one’s IT network as well as educating one’s employees on online safety, password management and recognition of phishing attempts. In an organization, a single system running Windows XP, or even a system running current Windows version, that is not kept up to date may void a cyber security claim or even the whole policy (based on a recent article from Today’s Cybersecurity Leader – “The integration of small business cybersecurity protection and cyber insurance: An emerging trend in 2021 cybersecurity insurance”). An employee who uses the same login password on different sites as well as login in to his/her employer network/ online accounts may become the point of entry for cyber criminals and cause a security breach. Thanks to clever social engineering used by cyber criminals many small companies have been hacked by phishing emails pretending to have been sent from legitimate sources. It is important to train employees to recognize signs of phishing skims to prevent being taken advantage of and losing critical financial, confidential and customer information ( see The Top 5 Cyber Security Practices).

In conclusion: a small/micro business must ensure utilizing proper cyber security platform combined with proper cyber insurance policy to protect themselves from hacks and breaches that fall inside their policy coverage. This combination of cyber security along with cyber insurance is beneficial to both a small/micro businesses and insurance companies (decrease in possibility of a cyber-attack decreases risk of it, lowering risk to insurance company thus keeping the premiums down).

To learn more about how to tighten your company’s security (network security, password management, proper backup solutions, deployment of other security controls such as: antivirus, end point protection etc.) do not hesitate to contact us. Remember, you are never too small to be affected by cybercrime and you’re never too small to receive a proper, professional IT care!

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