OBTAINING CYBER
INSURANCE –
ISN’T A GIVEN!

In an increasingly digital world where businesses rely heavily on technology for their operations, the importance of cyber insurance cannot be overstated.

Australian businesses, regardless of their size or industry, face the ever growing threat of cyberattacks and data breaches.

Here we explore the compelling reasons why all Australian businesses should seriously consider investing in cyber insurance.

The cyber threat landscape in Australia

Australia has experienced a significant surge in cyber threats in recent years. The country has been targeted by a variety of cyberattacks including ransomware, phishing and data breaches. Small and medium sized businesses (SMBs) are not immune to these threats. In fact, cybercriminals often target smaller enterprises as they may have less robust cybersecurity measures in place.

Reasons to invest in cyber insurance

1. Financial protection

One of the primary reasons to invest in cyber insurance is financial protection. Cyber incidents can result in substantial financial losses including the cost of investigating the breach, notifying affected parties, legal fees and potential regulatory fines. Cyber insurance helps mitigate these financial risks by covering these expenses to ensure that a business can recover more swiftly and effectively from an attack.

2. Reputation management

Reputation is a valuable asset for any business. A cyberattack can tarnish a company’s reputation and erode the trust of its customers and partners. Cyber insurance often includes coverage for reputation management and public relations efforts to help rebuild trust with stakeholders and customers.

3. Legal and regulatory compliance

Australia has stringent data protection laws including the Privacy Act and the Notifiable Data Breaches (NDB) scheme. Failure to comply with these regulations can result in severe penalties. Cyber insurance can assist businesses in covering the costs associated with compliance and legal obligations after a breach.

4. But is cyber insurance easy to obtain? 

While cyber insurance is an essential safeguard for businesses, obtaining coverage requires adhering to certain checks and measures.

Insurers assess a company’s cybersecurity posture to determine eligibility and premium rates.

How does your business rate? 

The checks and measures you should have in place to secure cyber insurance

1. Robust cybersecurity practices

Insurers expect businesses to have strong cybersecurity practices in place. This includes the implementation of firewalls, intrusion detection systems, regular software
patching and employee training in cybersecurity best practices.

2. Incident response plan

Having a well defined incident response plan is crucial. It demonstrates that the business is prepared to handle a cyber incident effectively and minimise its impact. Insurers look for organisations with detailed plans that include communication strategies and action steps.

3. Employee training

Employees can be both a business’s greatest asset and its greatest vulnerability. Insurers may require evidence of ongoing cybersecurity training for employees to reduce the risk of human error leading to cyber incidents.

4. Encryption and data protection

Encrypting sensitive data and protecting it through access controls is fundamental. Data breaches are a primary concern for insurers and measures to safeguard data are
closely scrutinised.

5. Regular security audits

Many insurers request regular security audits and vulnerability assessments. These assessments help identify and address potential weaknesses in the company’s cybersecurity infrastructure.

While the need for cyber insurance is clear, Australian businesses must be proactive in implementing strong cybersecurity measures to qualify for coverage.

Insurers play a critical role in promoting good cybersecurity practices, ultimately benefiting both businesses and the broader cybersecurity ecosystem.

Partner Purl is : 50471c45

 

Topicsheets

 

Topicsheets

Helping you with your insurance needs

We have access to reputable insurance providers who can provide a range of personal, home and business insurance.
Reach out if you have a premium due soon to see how we compare.


Notice: Trying to access array offset on value of type null in /home/customer/www/yourfinancenews.com.au/public_html/wp-content/plugins/ycm-landing-page/landing-page-api-helper.php on line 60
ABN 83 108 030 173Australian Credit Licence xxxxxx

Disclaimer: This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances. Your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. © 2023