Cyber Insurance | Do you need it?

Cyber-crime is a very real threat to businesses in New Zealand. Per Quarter In 2022, according to CERTNZ there were an average of 2166 reported cyber security incidents in New Zealand with the cost of these incidents averaging at NZD $4.5 million per quarter. (and thats only the incidents that were reported which is believed to be less than 25% of all cybercrime in New Zealand)

Why do you need Cyber Insurance?

Cyber attacks on businesses in New Zealand are becoming more sophisticated and frequent. In recent years, a number of high-profile companies have been targeted, including Air New Zealand partner Travelex, Fisher & Paykel Appliances, Garmin, Canon, Honda, BlueScope Steel, Lion, transport giant Toll Group, Twitter, MetService, and the NZX. However, it is not just the big companies that are being targeted. Small businesses are also being increasingly targeted by cyber criminals.

There are a number of reasons why cyber attacks are becoming more common. One reason is that the internet is becoming more and more essential for businesses. As businesses rely more on the internet, they become more vulnerable to cyber attacks. Another reason is that cyber criminals are becoming more sophisticated. They are using increasingly sophisticated techniques to target businesses.

The impact of a cyber attack can be devastating for a business. A cyber attack can lead to data breaches, financial losses, and reputational damage. In some cases, a cyber attack can even lead to the closure of a business.

Conclusion: Yes you do need Cyber insurance.

What is Cyber Insurance?

Cyber insurance is a type of insurance that can help businesses to protect themselves from the financial losses that can result from a cyber security incident. Cyber insurance policies typically cover a range of costs, including:

The cost of data recovery
The cost of legal fees
The cost of public relations
The cost of business interruption

1. Will my general liability policy satisfy cyber liability?

General liability insurance covers bodily injuries and property damage resulting from your products, services or operations. Cyber insurance is often excluded from a general liability policy.

It pays to check your current policies and ask questions. You may find that your other business cover won’t respond to a cyber or data breach claim.

2. The law has changed

The Privacy Act 2020, which came into effect on December 1, 2020, now requires all businesses to report data breaches to the Privacy Commissioner. Failure to report a data breach can result in significant fines.

Points to look for in your Cyber Insurance policy:

Business Interruption: This coverage will help to pay for the costs of lost revenue and expenses if your business is forced to shut down due to a cyber attack.

Hacker Theft Cover: This coverage will help to pay for the costs of stolen or damaged data, as well as the costs of recovering that data.

Restoration costs: This coverage will help to pay for the costs of restoring your computer systems and networks after a cyber attack.

Public Relations: This coverage will help to pay for the costs of dealing with the public relations fallout from a cyber attack.

Network Extortion: This coverage will help to pay for the costs of paying a ransom to hackers who have taken your data hostage.

Data Forensic Expenses: This coverage will help to pay for the costs of investigating a cyber attack and determining the extent of the damage.

Third-Party Liability: This coverage will help to pay for the costs of lawsuits filed against your business by third parties who have been harmed by a cyber attack.

It is important to note that not all cyber insurance policies will cover all of these expenses. It is important to read the policy carefully and to ask questions if you do not understand something. By understanding your policy, you can make sure that you are getting the coverage that you need.

What is the likely cost of taking out Cyber Insurance?

The cost of cyber insurance varies depending on the size of your business, the level of coverage you need, and the risks your business faces. In general, cyber insurance is relatively affordable, with premiums starting at a few hundred dollars per year for small businesses. However, larger businesses with more complex IT infrastructures may pay several thousand dollars per year for cyber insurance.

What else can you do in the war against Cybercrime?

There are basic things that you can do to ensure good Cyber security. In this recent blog we share some top tips for your company.

Top tips to avoid cyber security threats:

CERT NZ has a number of useful and practical resources for businesses on keeping systems and data safe from cyber security attacks, including cyber security risk assessments for business, cyber security awareness for staff, phishing scams and your business and protecting your business online.
CERT NZ offers the following tips for simple, practical steps for businesses.

Install software updates

Implement two-factor authentication (2FA)

Back up your data

Set up logs

Create a plan for when things go wrong

Update your default credentials

Choose the right cloud services for your business

Only collect the data you really need

Secure your devices

Secure your network

Manually check financial details

For more info and links click here:

Cyber Security is a very real issue facing business owners these days. If you would like to discuss your individual needs, the ITA provide advice to business owners and security assessments to ensure that your business has the best protection.

If you would like further advice on Cyber Insurance please feel free to reach out here to one of our friendly, nationwide members. Note: We are not Insurance agents nor acting for any Insurance provider, but we do know the answers to most of the awkward questions that you will need to answer when taking up cyber insurance with your broker or insurance company.

This article was kindly written by our ITA associate Victoria Mc Noe from Decision1 IT Solutions Ltd., Dunedin.
IT Alliance Members:

CT Business Solutions | Hamilton | Morrinsville | Matamata-Piako | North Waikato
Ultra IT | Northland | Kerikeri | Whangarei
IT Live | Auckland
Technology Partners | Tauranga
Vision Lab | Te Puke
AdvancedIT | Rotorua | South Waikato
BlackSANZ | New Plymouth | Taranaki
GTB IT Solutions | Wellington | Kapiti
Decision1 IT Solutions | Dunedin | Otago
IT Centre | Wanaka | South Otago
Voicecom | Invercargill | Southland

Related Services:
Managed Cyber Security
Advanced Email Protection
Check | Has your email been breached?

Don't just take our word for it | Here are some authorative links to NZ Government related guides and information
CERT NZ | Quarter 3/2022 Cyber Security Insights
CERT NZ | Phishing Scams and your business
CERT NZ | Data breach
CERT NZ | Insider Threat
CERT NZ | Protecting your business from spear phishing and whaling
CERT NZ | Business email compromise
CERT NZ | Ransomware
Business-Govt-NZ | Keep your data secure
Business-Govt-NZ | Storing and backing up data
Business-Govt-NZ | Implement and test backups

This Article is about: Cyber Insurance , do you need it? | CT Business Solutions | Last Updated 19/05/2023

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