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Business Cyber Insurance Insurance

Cyber insurance for Small Businesses: Why Hackers Still Target You

As a small business owner, you might have wondered, ‘Why would cyber criminals target me?’ The truth is, the misconception that hackers only target big corporations is what makes small businesses like yours prime targets for cyberattacks. Your size doesn’t make you immune; it makes you vulnerable.

Hackers often see small businesses as easier targets because they may have fewer cybersecurity resources, outdated systems, or less formal security processes in place. They may not invest as much in cybersecurity features, or they don’t practice it diligently enough. That is why cyber insurance is an important consideration, no matter the size of your operation. And why, when it comes to risk management, the smartest move is simple. Seek professional help because a broker would know.

Why do hackers target small businesses?

Small and medium-sized businesses are the most frequent targets of cyberattacks. Information like credit card details, employee records, and client emails can be just as valuable as a corporate database. And compared to big corporations, small and medium businesses are also easier targets. Here’s why:

  1. Easier defences to break – Large corporations invest heavily in cybersecurity. Small businesses often lack the same resources, which makes them easier targets.
  2. Valuable data, no matter the size – Even a small consultancy, café, or trades business stores credit card numbers, employee records, or client emails. To hackers, that’s just as valuable as a corporate database.
  3. Automated attacks don’t discriminate – Hackers may use bots that scan thousands of sites simultaneously, looking for weak passwords, outdated plugins, or unpatched software. These aren’t choosing you personally, they’re simply looking for an easy way in.
  4. Gateway to bigger fish – Sometimes a small business is the back door into larger partners or suppliers. Hackers typically breach the security of small players, collecting data they can use to move upstream and compromise the security of other members of the supply chain.

How can cyberattacks impact small businesses?

Dealing with cyberattacks is stressful enough, but the aftermath can be devastating. And for many small businesses, the chances of recovery are slim. Common consequences include:

  • Ransomware – Hackers encrypt your systems and may threaten to release private information in exchange for a substantial payout.
  • Phishing scams – The information may be used to send fraudulent emails to staff, tricking them into transferring money.
  • Data breaches – Your customer or employee details may be exposed, leading to fines or lawsuits.
  • Reputation damage – Clients may lose trust instantly, which can harm long-term relationships.

Studies show many small businesses never recover financially from a significant cyber incident. And believing you’re “too small” is precisely what makes you a target. Think of it like leaving your shop unlocked because you assume no one would bother stealing.

Cyber criminals thrive on having targets adopt this mindset. However, the truth is that they’re not always looking at the size of the business. They are opportunists whose goal is to exploit your vulnerability.

Hackers target small businesses as a gateway to bigger corporations in the supply chain

How can cyber insurance protect you?

No business is 100% secure, even with strong Information Technology (IT) support. Cyber insurance provides a practical safety net designed to help your business recover in the event of a data breach. Policies typically cover:

  • Incident response – IT forensic experts, legal advice, and crisis Press Relations.
  • Business interruption – compensation for lost revenue when systems are down.
  • Cyber extortion – ransom payments and negotiation support.
  • Third-party liability – legal defence and damages if clients or regulators take action.

A single attack could wipe out years of hard work, which is why cyber insurance is crucial for keeping your business protected.

Why work with a broker to secure your insurance?

Not all cyber insurance policies are equal. They can vary in terms of the coverage they offer, exclusions, and conditions. Some may exclude certain types of attacks or limit payouts. And when the fine print can make or break your cover, it’s important to have professional help in reading through it. A broker would know:

  • How to assess the specific risks for your business and industry, helping tailor coverage that would work for you
  • How to identify hidden gaps or exclusions in a policy that can leave your business exposed
  • How to negotiate with insurers to get a deal that fits your needs and works with your budget
  • How to fight for a beneficial outcome when it comes to making a claim

Attempting to navigate the complexities of cyber insurance alone is risky. With a broker, you’re guided by expertise every step of the way, providing you with the reassurance and guidance you need.

Every business needs cyber insurance

Cyber criminals don’t care if you’re a one-person consultancy, a café owner, a growing trades business, or any other small business. If you’re online, you’re a potential target. That’s why cyber insurance is no longer just for big companies. Small businesses are discovering just how relevant and valuable it is.

So, the next time you wonder why hackers would bother with a small business like yours, remember this: they already are. The real question is, will you be ready?

And when it comes to knowing what cover you need, what policy exclusions mean, and how to protect your livelihood? A broker would know. Learn more about cyber insurance today. Reach out to our team of brokers at East West Insurance Brokers.

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Business Cyber Insurance Insurance Insurance Insights

Protecting Your Business With Cyber Risk Management

Cyber risk is one of the most common threats for Australian businesses. It can disrupt operations and cause serious losses.

To help businesses, the Australian Government released the Essential Eight. This is a set of eight practical cybersecurity strategies. They are designed to help businesses get back to trading quickly after a cyber incident.

Essential Eight Cybersecurity Strategies

The Essential Eight encourages businesses to:

1.Keep software up to date: Regularly update your operating systems and applications to close security gaps.

2. Control access: Only allow authorised staff to make important system changes. Remove access when staff leave.

3. Use strong passwords and MFA: Strong passwords plus multi-factor authentication (MFA) add an extra layer of protection.

4. Limit risky programs: Block or restrict applications and macros that are commonly used to spread malware.

5. Back up data often: Make frequent, secure backups. Test them to make sure you can restore data quickly.

6. Protect against phishing and unsafe sites: Reduce risk from malicious emails and dangerous websites.

7. Have a simple response plan: Know what steps to take and who to contact if something goes wrong.

8. Educate your staff: .Use monthly updates from the Essential Eight team to keep staff aware of the latest cyber threats.

Australian business protecting against cyber risk with Essential Eight cybersecurity strategies

Why Cyber Risk Management Matters

Insurers now look closely at cyber risk management when deciding coverage, premiums, and claims for Australian businesses. Businesses that follow frameworks like the Essential Eight are better prepared if a claim occurs.

Demonstrating these controls can also help negotiate stronger coverage or lower premiums.

What You Should Do?

If you’re reviewing your insurance or risk management, now is a good time to consider how the Essential Eight cybersecurity strategies could be implemented in your business. Contact your broker to discuss these controls in detail.

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Cyber Insurance

How to navigate rising cyber insurance premiums

Survey after survey, business executives have unanimously agreed to one thing: the risk of a cyber attack as their biggest fear. Reviewing the most recent Allianz Risk Barometer, cyber incidents and business interruption tie as the top concerns of Australian businesses, with over 40% of responses to these risks.

These results come as no surprise to cyber security experts, with cyber crimes becoming increasingly common especially since the pandemic began. At the start of Covid-19, we saw a spike in the number of ransomware attacks against businesses of all sizes. With the continuous evolution and advancement of these ransomware, they are becoming more successful in their attempts to harm organisations, costing businesses billions of dollars every year. With many of us continuing to work remotely in the endemic stage, there are no signs of cybercrimes slowing down.

According to the Australian Cyber Security Centre (ACSC), the 2020/21 financial year saw over 67,500 cybercrime reports made via ReportCyber. In an everyday perspective, one cybercrime is reported approximately every eight minutes in Australia. That’s a staggering increase of nearly 13% from the previous financial year. The average 2017 cyber claim has risen over three times the severity of previous years, with ransomware incidents making up over 30% of claims. With cyber claims on the rise, it is no surprise that insurers are tightening their belts to accommodate the high levels of risk and cost of claims. The result of this will ultimately see the cost of premiums go up as well.

What does this mean for SME business owners?

As insurers are becoming more stringent with their requirements, it is increasingly difficult to get covered against cyber risks. You will need to show insurers that you are taking the necessary (and improved) steps to prevent a compromise to your IT systems. A previous mitigation plan may no longer apply as it could be insufficient to modern malware, and it will be tough to secure an insurer who will be willing to underwrite the risk. For bigger companies with an in-house IT department, preparing an updated mitigation plan may not be an issue. However, for small companies without a dedicated IT security team, this can prove to be a challenge.

Fortunately, there are steps that SMEs can take to meet the strict criteria set out by insurers. Mitigation is key when it comes to cyber security. The help of an experienced insurance broker can help bridge the gap and make it less complicated for small businesses to get covered. Remember, not all cyber policies offer the same level of protection. It can be challenging to determine the best insurance policy for your business. Engaging a broker will not only ease the application process, but they will also advise the steps you need to take to ensure your business continues running smoothly.

At East West Insurance Brokers, we know what the insurers are after. We’ll learn the ins and outs of your business and work with you to create a cyber security plan so you can get a fitting cyber insurance cover for your business. With hackers always at work and cyber attacks occurring more frequently, it’s best to act now before it is too late.

1800 809 132 | he***@******om.au | www.ewib.com.au

Important Note: All insurance policies have exclusions. Please refer to the Product Disclosure Statement or Policy Wording to decide whether an insurance policy meets your needs.

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