Do Professional Service Businesses Need Cyber Insurance?
Caeva O'Callaghan | September 27th, 2021
You may have heard of large multinational corporations needing cyber insurance – but what if you’re a small-scale service professional, will you also need cyber insurance?
Yes. No matter if you’re an accountant or designer, pharmacist, a video editor or consultant, if you offer professional services you need cyber insurance to protect your business and your clients.
Hackers are increasingly targeting small and medium sized businesses with poor online security, so it’s of vital importance that you not only have cyber insurance in place, but you also make sure your security software is up to date.
In this article, we’ll go over the following questions:
- What is cyber insurance?
- Is cyber insurance worth the money?
- How does cyber insurance protect my service business?
Whether it’s stealing data from your servers or holding valuable assets to ransom, cyber crime spells disaster for online businesses across the world. Find out how you can get protected by reading on.
What is cyber insurance?
Cyber insurance will help pay for damages, fines and new security measures if your company is targeted by cyber hackers.
Hacking and online attacks are increasingly common and very harmful. Criminals use increasingly sophisticated techniques to obtain sensitive data such as passwords or credit card data which they then abuse or sell to third parties.
This is why any business, big or small, needs cyber insurance. Consumers expect businesses to handle their information responsibly. Not only that, regulators can impose heavy fines for breaches in data security.
No matter your day-to-day operations, you need to consider purchasing cyber insurance if your business:
- Relies on computer systems and online software
- Holds sensitive data about customers or employees (e.g. names, addresses or financial information)
- Stores customer projects online
- Owns a website
- Issues online invoices
- Has a payment card industry (PCI) merchant services agreement in place
Cyber insurance can cover costs such as, but not limited to: loss of income, forensic investigation services, security upgrades, legal fees, regulatory fines and compensation.
Is cyber insurance worth the money?
If you read the news, you will have seen the alarmingly regular stories about large multinational companies falling victim to cyber attacks. It’s easy to think such catastrophes only happen to big corporations – unfortunately, the opposite is more likely.
As a small business owner, you cannot afford to sit back and relax when it comes to cyber security. If you use email, hold customer data, store projects or take payments online, this data could be at risk.
- IT consultants hold data including names, addresses, passwords and other personal information
- Marketing consultants hold company information and possibly financial information
- Photographers hold contact information, personal information and store images of their clients
- Architects hold contact information, and images and information about their clients’ houses and security
Each of these professional service businesses needs to keep its data both safe and easily accessible for its day-to-day operations. This means each one is an attractive target for cyber hackers.
Whether it’s customer invoices, design files, project plans or your next big pitch, losing access to business-critical files and data can be disastrous to a professional service firm.
How does cyber insurance protect my service business?
Cyber crime protects you by helping to cover the costs associated with a cyber hack, as well as assigning security experts to assist you in getting your defences shored up for the future.
A cyber attack can severely impact your business revenue. Loss of income as a result of damage to your reputation is a very real threat, as you are legally obliged to notify your customers if you suspect their data may have been stolen. If you work on a retainer basis or rely on word of mouth, this could spell disaster for future contracts.
You may even need to shut down or suspend trading for a certain period of time while you sort out the damage and put new security procedures in place. This can be very expensive, especially if your service business is your primary source of income.
Your cyber insurance can also cover third party liability costs. This includes compensation payable to your clients or employees, as well as covering the costs of hiring professionals to shore up your cyber defences and prevent another attack from happening in the future.
Cyber insurance is a vital part of business in the 21st century. Call us now to find out more.
All Information in this post is accurate as of the date of publishing.