25 Oct / Cyber Insurance & Why Your Business Needs it!
Have you ever received an phishing email that looked so real you almost clicked on it. What if one of your employees did. What if the virus spreads not only through your computer, but your employees computers, and now your customers as well? You are probably unaware that your current insurance does not cover cyber risks.
What is Cyber Insurance?
Cyber insurance is a specialized policy that is usually not included in your business insurance, and specifically protects your business, employees, and customers from various cyber risks. Cyber Insurance will cover everything your business needs to get back to normal operations. This includes IT specialists, Forensic Teams, Ransom Costs, Legal Costs, Compliance Costs, Public Relations, etc.
What are cyber risks?
Cyber risks are frequent, unpredictable and expensive. They can happen to any business, large or small at any time. They can include:
Identity Theft: Identity theft occurs when you or an employee’s private information is used for fraudulent loans or crime. With just a few pieces of your personal information, like your driver’s licence or social insurance number, an identity thief can open credit accounts, secure loans or even enter into contracts in your name.
Data Breach: A data breach occurs when data is lost, stolen or accidentally made public. Under the Digital Privacy Act every business has a legal requirement to report privacy data breaches, which can be very expensive for your business and its reputation.
Cyber Attack: A cyber attack occurs when a malicious person attacks a computer system or network on purpose. Attacks on a business’ computers can happen in a variety of ways, including hacking, malware attacks, phishing your employees, or denial of service attacks.
What does a cyber attack look like?
From my experience there are two common scenarios for cyber attack of small businesses in Canada:
Scenario 1: Ransom
You come to work in the morning, just like every morning, but this time you turn on your computer and you receive a message saying all of your customers information will be released unless you send a payment of $100,000. Pretty unnerving stuff!
Scenario 2: Lockout
You come to work in the morning, just like every morning, but this time one of your staff tells you that they cannot access their computer. In fact, all your staff say they cannot access their computer. A hacker has encrypted all your computers and now your staff cannot work.
Do you remember the last time you had a power outage at your office and all of your staff were just standing around.
You’re under Cyber Attack… now what?
You do the same thing you do every time you have a problem with your computers or network; you call your IT specialist. The specialist tells you it’s going to take at least a couple of hours or maybe even a day or so to sort this through. That means lost productivity, lost orders, lost customers, and lots of lost money.
So How Does Cyber Insurance Help?
Cyber insurance is comprehensive and is there to get you, your staff, and your business back in action with minimal disruption.
STEP 1: A forensic team is engaged to uncover the scope of the data breach and discover the source of the cyber attack.
STEP 2: The insurance company will cover the losses your business incurred from any disruptions to business operations.
STEP 3: A public relations team is hired to help your business offset what might be the biggest hit to your business: Reputation Damage
STEP 4: The insurance company covers legal support for the cost of legal fees and settlements if your business is sued because of a data breach.
STEP 5: The insurance company covers all costs incurred for notifying people whose data has been illegal accessed.
Is Cyber Insurance Expensive?
The cost of coverage starts at approximately $2,500 per year depending on the needs of your business. Uncle Jerry specializes has helped hundreds of small businesses across Canada, visit to UncleJerry.ca to get a free quotation.
Ok, so now I have Cyber Insurance, and I get attacked! What Do I Do?
Since you have a cyber insurance policy, all you need to do is call, your broker – me, and I will immediately work with the insurance company to dispatch IT support to get you back online, a forensic team to solve the issue, a public relations team to manage your reputation, and any legal support. I work for you, not the insurance company, so I am here to make sure that the insurance company is supporting you until you are back to business as usual.
What is the Digital Privacy Act and Do I need to report a data breach?
Under the Digital Privacy Act every business has a legal requirement to report privacy data breaches. In the event of a material data breach, businesses are required to notify affected individuals and The Privacy Commissioner. It doesn’t matter how small your business is, since businesses of all sizes are required to report data breaches. Failure to comply can mean penalties of up to $100,000 per offence.
Remind me again, why does my business need Cyber Insurance?
It’s NOT covered by standard insurance
Funds costly notification expenses required under the Digital Privacy Act
Enhances protection for your business Brand & Reputation
Balance Sheet protection.
Part of “Play Book” for Data Breach Response Plans / Disaster Recovery Plans
Reassures the Board (Directors & Officers)
Funds business interruption financial loss and helps minimize disruption.
Responds to Cyber Extortion, Ransomware, Cyber Crime (e.g. Social Engineering Fraud)
Responds to contractual, vendor or supply chain requirements for cyber insurance.
Includes Insurer’s pre- & post-breach resources and crisis management
Includes cyber & privacy liability protection.
Helps protect the data interests of your customers, stakeholders, volunteers, and employees
Many broad coverage options available with Insurers at competitive premiums
Key Features of Cyber Insurance Policy Coverage:
Cyber Extortion Defense
Data breach coverage & Notification Expenses
Business Interruption Loss
Identity Fraud Alert Service
All small, medium and large businesses face Cyber or Privacy Risks. These can include lost or stolen laptops, phones, thumb drives, employee error, malicious or criminal activity, unauthorized network access, or rogue employees. Often these have worldwide exposure.
Want to Learn More About Cyber Attack? Check out our Cyber Attack Glossary
Jerry Wiseblott – “Uncle Jerry”
Uncle Jerry leads the Wiseblott Insurance Team. He has been helping Canadians with insurance for over 35 years. The Wiseblott Insurance Team, in partnership with KRG Insurance Brokers, is a one stop shop for all your Insurance needs. Our team brings three generations of experience to the table. Whether it’s Cyber, Auto, Home, Business, Life or Employee Benefits Insurance we can look after all of your insurance requirements. Let our family protect your family – Everyone needs a great Uncle.