2015 may be a hallmark year for cyber insurance as many industry experts believe that small and medium sized businesses will begin to purchase policies to combat the financial damages of cyber crime. Cyber insurance was first introduced in the 1990s and covers the losses and costs associated with an attack on a company’s computer system. Though it was originally targeted at banks and Fortune 500 companies, many smaller businesses are starting to see the need for a policy.
In 2013 about 16% of small to medium sized businesses had a cyber insurance policy. This year the number grew to 33% and is expected to rise even further in 2015. Smaller companies have become a big target for cyber criminals as they often have less sophisticated security systems. In a recent survey, a third of small business owners reported being the victim of a cyber attack, with three quarters being unable to fully restore their data. The cost of a cyber breach can be devastating, especially in light of a recent federal court decision that held Target liable for the financial losses sustained by bank’s after its breach earlier this year. Businesses looking to protect themselves, and others they do business with, are finding they need to purchase policies beyond their general liability coverage.
Cyber criminals often see small businesses as the portal for more valuable data stored by large companies they do business with. While cyber insurance can help mitigate damages after the fact, EVS can help stop attacks before they happen. With products like IdentiFraud Corporate, businesses can be sure their data, along with the data of their partners, is more secure.
[Contributed by EVS Marketing]