Following the recent Optus and Medibank hacks, cyber insurance has never been so important.
Although Optus was hacked, they are diligent when it comes to best practice in cyber risk management. Optus was ahead of most Australian companies having had a cyber policy in place at the time of the hack to cover the cost of a data breach.
Most businesses are underprepared
According to the Actuaries Institute, in Australia, a cyber crime was reported every eight minutes over the past financial year – an increase of 13% on the previous year. Reported total economic losses in the year amounted to $33 billion, impacting government and the private sector, all sizes of organisations – from SMEs to the largest corporations – across industries and disrupting supply chains.*
Globally, 623 million ransomware attacks were recorded in 2021. That is 20 attacks every second and more than triple the number recorded in 2019.
Best practice in cyber risk management is for companies to undertake scenario planning to consider the possible outcomes of a cyber-attack. Organisations that undertake proper scenario analysis for cyber put a financial value on both the tangibles, such as forensic investigation costs and the intangibles, such as damage to brand reputation.
Here are some strategies to keep your business safe.
Cyber insurance coverage
Typical cyber insurance policies protect businesses against:
- Business interruption losses Covers financial loss you may suffer as a result of a cyber-attack cyber extortion
- The costs of a cyber-attack, such as hiring negotiation experts, covering extortion demands and prevention of future threats electronic data replacement The costs of recovering or replacing your records and other business data security and privacy liability
- Damages to your reputation resulting from data breaches, such as loss of third-party data held on your system defence costs Funds the legal costs of defending claims regulatory breach liability
- Covers legal expenses and the costs of fines arising from investigations by a government regulator electronic media liability The costs of copyright infringement, defamation claims and misuse of certain types of intellectual property online crisis management expenses
- Provides cover for the costs of managing a crisis caused by cyber hackers notification and monitoring expenses The costs of notifying customers of a security breach and monitoring their credit card details to prevent further attacks
Here are some claims examples your business can be covered for.
Do you need Cyber Insurance?
Speak to LA Insurance today to get a tailored cyber insurance solution for your business.
Source: AFR Disclaimer: Any information provided herein is of a general nature only. No consideration has been taken into your objectives, needs or financial situation. Before acting on this information you should consider if it is appropriate for your situation.