Unless you no longer listen to, read or watch the news, you can’t have failed to notice that cyber-attacks are on the rise.
The Co-Op ran out of food, leaving people in remote parts of Scotland with empty shops. Bastion of the high street, Marks and Spencer was similarly besieged. Fans of long-distance driving may have noticed that the haulage firm “Knights of Old” no longer trundle the M1 or A1
In today’s connected world, cyber threats have evolved into one of the most significant risks facing businesses of all sizes. In an interview on the BBC, Toby Lewis of Dark trace suggested that the more things are put online, and the web is relied on for business, the more risk there is of people attacking those areas to cause malicious harm, increasing the “attack surface area”. (BBC Radio PM Programme, 9th May). Hackers have told the media that businesses should “expect more attacks soon”.
Construction and real estate is no exception to this. Document management, time recording, email and many other systems are all potential vulnerabilities. And the weakest link might be one of your best employees who simply unwittingly clicks on a link or opens an email they reasonably think is genuine.
From ransomware attacks to data breaches, cyber incidents can cause severe financial and reputational damage. As a result, cyber insurance has become an essential part of a strong risk management strategy.
What Is Cyber Insurance?
Cyber insurance, also known as cyber liability insurance, is designed to help businesses mitigate the financial impact of cyberattacks. These policies typically cover a range of incidents, including:
Data breaches
Ransomware and extortion attacks
Business interruption due to cyber incidents
Legal fees and regulatory fines
Crisis management and public relations support
The Key Benefits of Cyber Insurance for Businesses
Financial Protection Against Cyberattacks
Cyberattacks can be devastating. According to IBM’s 2024 Cost of a Data Breach Report, the average cost of a data breach in 2024 exceeds $4.88M globally (and up to $9.36M in the United States). Cyber insurance helps cover these costs, including legal fees, forensic investigations, notification expenses, and compensation for those affected by a breach.
Business Continuity and Recovery Support
Many policies offer access to incident response teams that help companies respond quickly to minimise damage. This can significantly reduce downtime and ensure business continuity, which is crucial when every hour of disruption translates to lost revenue.
Legal and Regulatory Compliance
Most firms will be familiar with GDPR and related legislation. However, failing to secure sensitive information can result in hefty penalties, regardless of the cause. Cyber insurance often covers the costs associated with regulatory investigations, fines (where insurable), and mandatory notification requirements.
Reputation Management
Rebuilding trust after a cyber incident is tough. Some policies include coverage for public relations support to help manage communications with customers, partners, and the media.
Who Needs Cyber Insurance?
While large corporations are frequent targets due to the volume of data they handle, small and medium-sized enterprises (SMEs) are increasingly at risk - often because they lack robust cybersecurity infrastructure and the expertise to put systems in place to prevent attacks.
Cyber insurance is not a substitute for strong cybersecurity measures, but it is an indispensable layer of protection. As threats become more sophisticated, businesses must evolve their defence against attack. Investing in a cyber insurance policy today could mean the difference between a quick recovery and a catastrophic loss tomorrow. For more information on how cyber cover could help your firm, get in touch with one of the team today.
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