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Why All Businesses Need Cyber Insurance

Are you reliant on a computer to conduct your business? If the answer is “yes” then you have an exposure to a cyber event.


In this modern world, very few companies can afford to remain uninsured against cybercrime. While the attacks are digital, the effects are very real. Experts in the field warn that Kiwi businesses underestimate the risks, and that “New Zealand is no longer viewed as a safe haven”.


Is your business vulnerable?

Almost any business can fall victim to an attack via the internet. The methods used are increasingly creative and varied, targeting all kinds of online activity. No longer are you simply facing the prospect of a “hacker” stealing stored data. Phishers may con passwords out of your staff or customers. Ransomware is on the rise.


In this day and age, you don’t need to be running a tech-based business to be vulnerable to cybercrime. Small businesses, sole traders, large businesses, and everything in between should not only be taking the necessary steps to ensure good cyber security but also insuring against the risk of a breach. Cyber-attacks are no longer an “if”, but a “when”!


Do you carry out transactions online? Store data about your staff or customers digitally? Communicate via email? Does your business need a computer to operate? Are you using an online accounting or timekeeping/job scheduling tool? If you’ve answered yes to any of these questions, then your business is vulnerable.


If you use the internet for anything, you could be caught unawares. And for businesses, this can have unfortunate consequences.


The effects of cybercrime

Increasingly, the effects of digital attacks are just as real and impactful as the effects of fire, theft, flood damage, and other physical threats to your property. Here are some common types of cybercrime and the damage they can—and do—cause, which may be covered by a Cyber Insurance policy:

  • Ransomware: This is malicious software that blocks access to files or systems until a ransom is paid. Although CERT NZ recommends that businesses do not pay the ransom, understandably many business owners will do it to regain their access.

  • Phishing: This involves emails that are made to look official, often sent to employees in an effort to have them divulge passwords and allow criminals access to systems. The possible effects of phishing attacks are many and varied, from financial loss to trade secrets or sensitive data being stolen.

  • Malware: This catch-all term for malicious software includes any intrusive software that will damage or destroy your computer or network, or steal data from it. These can be particularly impactful to small businesses as they often cripple devices that may be costly to replace or repair—and may be crucial to operations. They also pose a threat to the security of stored data, which is a significant liability risk for organisations.


The three types of attack listed above are just the tip of the iceberg. New methods are popping up frequently as cybersecurity software catches up with the old ones—and for that reason, it’s important to take out insurance as well as employ preventative measures.


Cyber insurance

There are a range of cyber insurance policies available to cover all kinds of vulnerabilities. Some of these vulnerabilities include:

  • System damage

  • Computer virus transmission & hacking

  • Cyber extortion

  • Privacy fines & investigations

  • Privacy breach notification & loss mitigation


With so many diverse risks in the digital domain, it can be hard for businesses to know what they need and which policies will serve them best as part of their overall insurance portfolio. An insurance broker with experience in cyber insurance specifically can help you to ensure that your vulnerabilities are covered.


Let’s talk about keeping you covered online. Contact a BWRS broker today.


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