Cyber Risk Insurance Coverage

“Hackers are breaking the systems for profit. Before, it was about intellectual curiosity and pursuit of knowledge and thrill, and now hacking is big business.” – Kevin Mitnick

Effective use of internet technology has the potential to enhance the customer experience, improve organizational efficiency, and create great cost-saving opportunities. Along with all these benefits comes an ever increasing risk of being the victim of cyber crime.

Total annual cost relating to cyber crime is estimated to be between $375-575 billion. To put that number into perspective, the annual aggregate estimated global damage resulting from vehicle collisions is $518 billion.

In Canada, the cost, as of 2014, is estimated to be between $3-4 billion.

Beyond monetary damage, there are other unquantifiable costs. These costs include loss of reputation, erosion of consumer confidence, loss of sales, and cost of security enhancements.

Being a victim of cyber terror is more debilitating than a fire, liability, and theft. After a fire, a company can still set up a remote office. Some forms of cyber risk leave a company unable to access their files or entire network.

While many businesses still do not have cyber insurance today, within 5 to 10 years it will be uncommon for the serious business operation to not have proper insurance coverage in this area.

There are many aspects of Cyber Risk Insurance. At Bryson Insurance, our team of insurance professionals provide a complimentary risk assessment to assist in identifying cyber risk exposure. Connect with our team of professionals at 1-800-661-5196 or by clicking here to send us an e-mail.

Start a conversation with us on cyber insurance.

To provide an introduction, Cyber Liability often involves multiple channels of risk. These include Privacy Risk, Cyber Risk, and Liability Risk.

  • Privacy Risk involves the collection, use, or disclosure of personal or material data by those you do not choose to share it with;
  • Cyber Risk pertains to any sort of risk of financial loss, disruption, or damage to the reputation of an organization from some sort of failure of information technology systems;
  • Liability Risk is a more general insurance risk with a purpose of protecting from the risks of lawsuits and similar claims.

A complex array of cyber crimes have evolved over the past few decades. The three most common forms of cyber attacks are theft and other data attacks, Malware ( phishing and pharming ), and the wide variety of mechanisms that can infect computers.

What industries are most susceptible to experience a cyber incident?

IBM has collected historical data on what industries report cyber crime incidents. A breakdown of major industries include Manufacturing (26.5%), Banking/Insurance (20.9%), Communications (18.7%), Healthcare (7.3%), Retail (6.6%), Other (20%).

At this point, it is common to start thinking about how cyber risk impacts your business. It is best to have a conversation with one of our industry professionals. To connect with our team of professionals please call us at 1-800-661-5196 or click here to send us an e-mail.

We have created a simple chart that will provide you with some further perspective.

Cyber Risk by Industry SegmentRealtyContractorsRetailNon-profitHealthcare
Who do they maintain records on?current & past tenants, potential credit checkscustomers, employees, sub-contractorscustomer, employeesdonors, volunteers, employeespatients, doctors, nurses, other staff
What types of information do they keep on file?files containing financial information, background check informationfinancial information on cheques, credit cards, potentially have home security informationlarge amount of credit card datadonor financial, information, employee personal informationprotected health information, financial information, employee personal information
Who has access to information?condo association management, cleaning staffmanagement along with anyone that accepts paymentsall stafflikely all employeesall staff, including administration and booking staff
Is there a data retention policy?not likelynot likelypossible, but still have large amounts of datanot likelylikely, but still large quantity of data
What is the source of exposure?what is the source of exposure?websites, payment processingwebsites, payment processing, inventory systems, shipping systemswebsites, donation / payment processingwebsites, payment processing, medical devices

Most cyber risks are not insured. Global cyber insurance premiums currently cover less than one-half of one percent of the estimated cost of cyber crime. Cyber crime has the potential to cause major disruption in your normal business activity. Our purpose as insurance professionals is to help you mitigate the impact of risks to keep your operation headed in a successful direction. Cyber risk is a growing concern. To gain an understanding how it may affect you and your business, please set a time to meet with us by calling 1-800-661-5196 or e-mailing our office.