According to a recent Insureon-Manta survey, only 18 percent of small business owners think they are at risk for a cyberattack. Why is that a problem? Many studies claim those same businesses are more likely to be a target for cyberattacks than big companies.
Although breaches at large companies often grab headlines, those companies typically have a team of security experts dedicated to protecting data. Small businesses are often easier to breach because few have the resources to protect their systems.
Criminals may try to steal business information from you, but they may also use your IT systems as a stepping stone to other companies. Hackers used a small HVAC vendor to access data from up to 110 million Target customers in 2013.
Business owners should make cybersecurity a priority if they:
- Accept credit cards
- Store or process private information
- Conduct business online or in the cloud
How cyber liability insurance protects your business
No matter what industry you’re in, a data breach can hurt your business. First, there’s the immediate expense, such as alerting clients and hiring a cybersecurity expert to determine the source of the problem. The average data breach costs $3.6 million or $141 per data record, according to a study of more than 400 organization in 11 countries by the Ponemon Institute, sponsored by IBM Security. A breach can also damage your reputation, which may cost you future business.
Data breach recovery costs paid out of pocket can devastate a small business. That’s why many small business owners opt for cyber liability insurance, which helps businesses by covering some expenses, such as:
- Client notification
- Credit monitoring
- Crisis management and public relations
- Ransom
- Legal and forensic accounting services
You can purchase a standalone cyber liability policy. However, some insurers may add cyber liability coverage to a professional liability or business owner’s policy (BOP). Usually, the deciding factor is your industry. Someone who’s responsible for safe data storage, such as an IT professional, may add a cyber endorsement to their professional liability insurance. Business owners in other industries are more likely to add it to their BOP.
In addition to carrying cyber insurance, there are several steps businesses can take to prevent cybersecurity threats.
How to limit cybersecurity risks
When it comes to cybersecurity, businesses can reduce the chances of a breach by practicing good cyber hygiene:
- Use strong passwords. Long, more complex passwords are better than short, simple ones. If you deal with highly sensitive data, consider using a two-step authentication process.
- Keep your systems up to date. Install software updates and patches for your phone and computer as soon as they become available. Often these patches address security vulnerabilities.
- Use a firewall. A firewall prevents malicious software from reaching your network. Some firewalls also scan for viruses.
- Install antimalware and antivirus software. Protect your systems from malicious activity with antimalware and antivirus software. Remember to update this software when prompted.
- Ask your cloud provider about their security. Your provider should be able to answer questions about how they keep your data safe. Find out about their physical security measures and their encryption level.
- Choose a secure payment processor. Anyone who stores, transmits, or processes payment card information needs a processor that is PCI-DSS compliant. The rules can be intimidating, so work with a vendor with experience.
- Get a VPN. A virtual private network (VPN) encrypts your data. This helps provide an added layer of security when you’re on a public network.
- Add a cyber liability clause to your contracts. Work with a lawyer to develop a clause that assigns liability in the event of a data breach.
One final cybersecurity tip: Create an incident response plan that lists whom to contact and where backups are stored. It won’t stop a hacker from rooting through your data, but it can help you respond to a breach quickly and efficiently.
This story was submitted by Virginia Hamill and does not constitute the views or opinions of Upwork.
The post How Small Business Insurance Can Protect Your Company from Cybersecurity Risks appeared first on Upwork Blog.
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