What types of small businesses need cyber insurance?
The short answer is all of them. From phishing scams to high profile ransomware attacks, cyber crime is a global concern – and every business with a digital footprint should be concerned about it. While SMEs are smaller than large enterprises, they still hold sensitive customer information, vendor payment information and passwords on their computer systems or in the cloud – all the things cyber criminals are after.
That’s why all small businesses require comprehensive cyber insurance for business to help protect them, as well as ensure that the right cyber security solutions are in place that will help predict and prevent cyber criminals from avoiding attacks in the first place.
What are the common cyber threats that SMEs face?
Digital threats to small businesses are numerous and evolving. A new survey by the Canadian Federation of Independent Business (CFIB) found that nearly half of small businesses experienced a random cyberattack in 2022, while 27% experienced a targeted attack.
Here’s some of the most common types of cyber threats that small businesses face:
Phishing usually occurs via email when an attacker pretends to be a trusted contact to trick the end user into clicking a link that can download a malicious file or grant the attacker access to sensitive information and credentials. As a result of these phishing attacks, cybercriminals can gain access to business email accounts, and use them to fradulently request payments from their customers and employees.
The term “Smishing” is a mash-up of phishing and SMS (short message service). It’s basically phishing that uses text messages to target victims. Fake text messages are sent with an urgent call to action (usually requesting a debt or payment) and a link that either downloads malware or tricks the receiver into sharing sensitive information. As consumers and businesses spend more time on their devices, smishing is on the rise. In fact, Proofpoint’s 2022 State of the Phish report found that 74% of organizations in the US experienced smishing attacks in 2021.
Malware is a term used to describe malicious code that hackers can use to infiltrate a computer network, steal sensitive data, and cause system failures. Usually transmitted through fake website downloads or spam emails, the fallout of a malware can be irreversible, leading to a loss of customer trust and revenue.
A ransomware attack involves hackers stealing data and encrypting it so the company can’t access it. A ransom is then demanded to either unlock the data or to prevent the hackers from releasing or selling sensitive information on the dark web. In 2021, the Cybersecurity and Infrastructure Security Agency (CISA) reported a trend toward hackers redirecting ransomware efforts away from high-profile corporations and critical infrastructure to easier to-access SMEs.
According to a 2021 report by the European Union Agency for Cybersecurity (ENISA), the average annual cost of cybersecurity incidents caused by insiders within an organization hit €11.45 million. Insider threats to cybersecurity come from employees, contractors, or other authorized users who have access to the company’s systems and data.
These threats can take various forms, such as employees intentionally stealing or selling sensitive data, accidental exposure of confidential information, or employees falling victim to phishing attacks and inadvertently giving hackers access to the company’s systems. Small businesses are particularly vulnerable to insider threats because of limited resources and difficulty monitoring employee behavior.