“I’m not a target.” “We’re too small.” These are two of the most common objections that we hear when discussing cyber threats. In today’s digital-first business environment, cyber threats are no longer reserved for large corporations with massive IT departments. Small and mid-sized businesses are increasingly becoming the targets of cyber attacks and the consequences of an attack can be devastating.
Being proactive is fundamental to preparing yourself for impending cyber threats. Be sure to consult with your managed IT service provider and cyber security professional to ensure you have critical security measures enabled. In addition to this, consider adding cyber liability insurance to your insurance program.
Cyber liability is designed to protect businesses against financial losses resulting from data breaches, cyberattacks, and other digital threats. Here are three of the most common and costly cyber incidents we’re seeing today:
1. Business Email Compromise
“The email looked like it was from the CEO. I had no idea!”
One of the most frequent and financially damaging cyber events today is business email compromise. In this scheme, hackers impersonate a trusted executive, vendor, or employee and trick someone into wiring funds or sharing sensitive data.
Example: A finance manager receives an urgent email from what appears to be the CEO requesting a wire transfer. The email looks legitimate, but the sender is a fraud. By the time the scam is uncovered, the money is long gone.
In addition to this, we’ve seen business email compromises arise from employees handing the attacker the keys to their email. Requests to input your username and password may appear to be legitimate, but in reality, may be a threat attacker.
Cyber liability coverage can help recover lost funds and cover the forensic investigation, legal defense, and customer notification requirements that follow.
Be proactive before you take any steps to comply with the requests. Contact your IT Department or cyber security professional if something appears to be questionable. As for financial request, always contact the requesting party on a known, good phone number.
2. Ransomware & Extortion Attacks
“You pay us now or your systems stay locked.”
Ransomware continues to surge, especially targeting industries like healthcare, manufacturing, education, and professional services such as lawyers and accountants. In these attacks, hackers encrypt company data and demand payment for its release.
Example: A law firm finds its client files, communications, and billing software are now inaccessible because their systems have been encrypted. The hackers demand payment of $250,000 in cryptocurrency to restore access.
Even if you don’t pay the ransom, the cost of downtime, data restoration, and reputational damage can cripple your business. Cyber liability insurance can cover the cost of ransom payments, forensics, system restoration, lost income, as well crisis management to help you navigate your communications to your customers and any other parties you must notify.
3. Social Engineering Attacks
“The hacker didn’t break in — they talked their way in.”
Social engineering is the art of manipulating people into giving up confidential information or money. These attacks don’t require hacking into your systems. They just require a convincing story and the right timing.
Example: A hacker poses as a trusted vender. They manipulate the invoice with account information reflecting their bank accounts and request payments for services. You wire the
Cyber liability policies can cover the fallout from these situations. This includes funds transfer fraud, loss of sensitive data, and the cost of restoring trust with clients and vendors.
Bottom Line: Cyber Liability Is No Longer Optional
If your business stores customer information, uses email, accepts online payments, or relies on third-party services, you need cyber liability protection. The risks are evolving and so should your insurance coverage.
Want to know if your business is adequately protected? Contact us today to learn more.
