While cyberattacks on large corporations are becoming ever more common in the news, smaller and medium sized businesses are equally at risk, and are generally less aware of the danger.
“Whether they want to admit to it or not, cyber risk is the number one business continuity issue or business survivability issue facing businesses today,” said cyber security expert Dominic Vogel, Principal & Chief Strategist at Cyber.SC. “And what are businesses doing about that? For the most part the answer is, ‘Nothing – we’ve actually never even thought about it.’”
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That oversight could be costly. Cyber security breaches in Canada cost companies on average $5 million dollars in direct and indirect expenses, and many companies would not be able to withstand such a financial hit.
It gets worse. According to Vogel, three quarters of all cyberattacks are focused on the SMB space, and 60 per cent of SMBs that witness a cyberattack go out of business within six months of the attack.
“Smaller and mid-sized businesses need to understand that cyber insurance may be even more critical for them than larger organizations that have access to more resources.” —Grant Alsop, vice president of Construction and Real Estate with Shaw Sabey & Associates
“For me, the dirty little secret is that big businesses like Target, Staples or Equifax, all these big companies experience data breaches, and they all end up surviving,” said Vogel. “What you don’t see is the hundreds, if not thousands of other commercial entities or organizations that are not household name brands, they experience those same breaches and they go out of business. They just don’t get reported on the six o’clock news.”
Read also: Six reasons why your business needs cyber liability insurance
Vogel encourages his clients to think of it, not as a technical problem, but as a business problem. “If your approach to cyber security is oh, we have a firewall or we pay someone to run our IT, then you’re viewing it as a technical issue. Ultimately, this is a business issue, so you need to have a business approach or a risk management approach.”
Dealing with cyber security is all about risk management.
“Smaller and mid-sized businesses need to understand that cyber insurance may be even more critical for them than larger organizations that have access to more resources,” said Grant Alsop, Vice President, Risk Management and Commercial Lines for Shaw Sabey & Associates, a Vancouver-based insurance brokerage. “A cyber insurance policy could be critical in helping an organization to continue operating, keeping them afloat and walking them through an attack from start to finish.”
The other aspect, says Alsop, is that cyber insurance not only covers the damages resulting from the attack, but many policies will also include incident response services. “Legal advice, consultants, and triage experts can be provided to assist in resolving the incident, providing you protection in real time.
And with market flush with cyber security options, the cost of a cyber policy has never been more economical.
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Featured in this article:
Grant Alsop, Vice President, Risk Management and Commercial Lines
604-699-2073 | galsop@shawsabey.com
Dominic Vogel, Principal & Chief Strategist
604-816-5457 | dvobel@cyber.sc
