(BPT) - Cyber security risks are higher than ever before. The latest IBM Cost of a Data Breach Report1 shows that the global average cost of a data breach reached an all-time high in 2023, increasing 15% over the last three years.
No business is immune to this growing threat, and many business owners don't know where to start to protect their business from cyberattacks.
Unfortunately, even when business owners do their due diligence to protect their assets and livelihood by choosing commercial business insurance, cyber coverage isn't always part of the equation. 'Numbers vary, but most sources agree that around a quarter or less of small businesses have cyber insurance.2,3 Considering cyberattacks are a risk to all business types and sizes, that's a concerningly low percentage,' says Brittney Passini, director of Product Development at Acuity Insurance.
Serious impacts of cyberattacks
The truth is, most businesses aren't proactively avoiding cyberattacks. According to Security Magazine, a cyberattack occurs every 39 seconds,4 and when they occur, they can have devastating consequences.
Business impacts include:
- Unplanned expenses. Cleaning up a cyberattack requires a lot of people. Paying for IT, public relations and legal support can be costly. Companies often spend up to $100,000 to cover all costs associated with a data breach.5
- Operational disruptions. Repairing cyberattacks can require temporary shutdowns and shifting resources - slowing progress in other areas of the business.
- Reputational damage. Businesses may struggle to regain customer trust following a cyber incident.
Small businesses are not immune to the threat. In fact, according to a 2021 Verizon report, 46% of cyber breaches affected businesses with fewer than 1,000 employees. Even worse, of the small businesses hacked, 60% were out of business within a year of the event, according to the U.S. National Cybersecurity Alliance.2 Thankfully, there are a few things you can do today to prevent future damage to your business.
How to boost your business's cyber security
- Develop a cyber security strategy.
Your cyber security measures will be unique to your business, data and needs. There is no one-size-fits-all solution. To start, consider updating and patching your systems, always use secure passwords and set up multistep authentication, back up data outside of your network, and train your staff on cyber security best practices.
- Get covered.
There's no foolproof approach to cyber security. Even businesses with well-thought-out cyber security programs can fall victim. Cyber insurance, such as Acuity Cyber Suite, includes options for identity fraud, computer fraud and attacks. Having cyber coverage can be the difference between incurring huge losses - including the entire business - and getting back on your feet if a loss occurs.
Ultimately, Passini recommends business owners combine cyber security best practices with cyber insurance to prevent incidents from happening and for protection just in case.
'Businesses can manage growing cyber-risks by having effective technology controls, sound business practices and appropriate insurance coverage,' Passini says. 'Work with an independent insurance agent who understands your business and can help ensure your business is protected, now and in the future.'
1 https://www.ibm.com/reports/data-breach
2 https://www.fundera.com/resources/small-business-cyber-security-statistics
3 https://www.strongdm.com/blog/small-business-cyber-security-statistics#:~:text=18.,it%20until%20after%20an%20attack
4 https://www.securitymagazine.com/articles/87787-hackers-attack-every-39-seconds
5 https://www.propertycasualty360.com/2019/02/28/is-your-data-in-the-cloud-its-still-at-risk-of-cyberattack/