A recent report by Lloyd’s of London shows that, in the last year alone, 60 percent of small UK businesses and 80 percent or larger corporations suffered from the effects of a cyber breach, bringing significant financial implications and serious reputational damage.
Unfortunately, while Public Liability Insurance, Employer’s Liability Insurance, and Professional Indemnity Insurance are all commonplace, many business are overlooking other types of essential business insurance that are leaving them vulnerable to dangers. According to reports, just 10 percent of UK businesses have a comprehensive business insurance package that covers and protects against the risk of cyber threats.
Do I Need Cyber Insurance?
While cyber insurance is not a legal requirement for UK businesses, it is one of the most valuable forms of business insurance that is essential for many different industries and sectors. You should consider this form of business insurance if:
- You store confidential data in the cloud.
- You use an internal network to store client contact details.
- Your business relies upon IT systems and networks to operate on a day-to-day basis.
- You correspond with clients via digital channels.
- You operate an eCommerce website and regularly process credit card information.
It’s important for businesses to keep in mind how much of a financial impact a cyber attack could inflict. Lloyd’s suggests that a cyber security breach could cost small and medium enterprises (SMEs) between £65,000 and £115,000, and larger corporations could find the cost closer to £1.15 million.
Comprehensive Business Insurance Essential in the 21st Century
A question many businesses are asking is why cyber insurance is so essential today. Contrary to popular belief, it’s not that cyber risk has significantly increased in recent years. Instead, it’s more that the effects of a cyber breach will have much more of an impact at a time when many businesses are relying upon digital technology for practically every aspect of their business – storing employee information, using cloud-based storage for client documentation, and utilising digital channels for marketing and promotion. Essentially, if a breach occurs, not only will your business be unable to operate successfully, but you could find that your clients also suffer third party damages.
Finding the Best Business Insurance
‘Insurance is not a substitute for good cyber security but is an important addition to a company’s overall risk management’, says Mark Weil of risk management firm Marsh UK. Comprehensive business insurance that includes cyber threat cover gives your business added protection – both financially and in terms of reputation – at a time when many companies are leaving themselves vulnerable to attack. Businesses can easily identify which UK brokers offer cyber insurance by comparing business insurance online at compareyourbusinesscosts.com.