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Wise up to cyber insurance

A few years ago insurers were falling over themselves to provide cyber insurance for small businesses. There was a feeling in the insurance market that any company could purchase cyber insurance and the premiums were staggeringly low. How things have changed!

Yes, there are still plenty of companies willing to provide cyber insurance. But there is no longer the same clamber for business. The first time in as long as I can remember, we have seen cyber insurers decline to offer quotes. In fact, it’s now more common for a small business to be declined cyber insurance than offered insurance.

Insurers have ‘wised up’. Wised up to the fact that if a business doesn’t take cyber security seriously they are almost certainly a cyber attack (and therefore cyber claim) waiting to happen.

Insurers no longer wish to insure a business that is almost certainly going to claim.
The certainty to claim is driven by the sheer volume of cyber attacks on small businesses. The statistics are high – even the government quotes that 4 in 10 businesses have suffered a cyber attack.

The insurers are all too aware of these figures and claims, hence the increasing difficulty for small businesses to obtain cyber insurance with reasonable cover at a reasonable price.

But all is not lost.

We have begun to see a trend. The more seriously you take cyber security, the more likely you are to obtain insurance AND you’ll be less likely to be hacked.

Ultimately taking cyber security seriously should be paramount, whether you have insurance or not.

When we talk about taking cyber security, this usually comes down to investing money. Which is why certain insurers now ask what a business spends on cyber security.

A £5m business spending nothing on cyber security sends the wrong message. A £5m business spending in excess of £25,000 on cyber security annually is taking the issue seriously, relevant to its size, and therefore far less likely to sustain a claim.

There is little value applying for cyber insurance if you don’t have your own house in order.
We see many businesses that lack even the most basic IT security. You get far more bang for your buck in terms of keeping your business safe, by spending some money on cyber security improvements. We cannot profess to be cyber experts, very few business owners are! But you need to be brave and seek support from those in the know. Whether that’s your local IT support company or a full scale managed services provider.

Nail down the basics (and quickly, time is of the essence!) then get cracking with cyber insurance to provide that sleep easy protection.

When you do come to apply, you’ll get far better cover and premiums quoted if you demonstrate the basic insurers would expect.