You have health insurance, car insurance, homeowner’s insurance, how about cyber insurance? More and more local businesses are buying protection for themselves from huge financial losses in a cyber-attack.
Cyber protection is a fairly new offering in the insurance industry. But one Sioux Falls development company says cyber insurance gives them peace of mind, but also raises concerns about how much coverage is enough.
Small businesses can present hackers with a big target.
“Hackers go to basically, the weakest link so the smaller your organization, the fewer resources you might have to apply to cyber-security and those sort of things which make you a bigger target, Eide Bailly risk advisor Eric Pulse said.
Experts at this cyber-security workshop in Sioux Falls stressed the importance of ongoing employee training since people are often the weakest link in cyber-security.
“It’s the humans that are causing the problems that are clicking on a phishing link that they shouldn’t or maybe they mis-patch a device or something like that where a hole is opened and then the bad guy is able to come in,” Pulse said.
PERRY GROTEN: Experts say cyber insurance is another tool to protect your business from hackers. But most businesses don’t carry the insurance because many of them don’t know that it’s even offered.
“There’s a big learning curve here as businesses learn more about the coverage, what’s covered, what’s not covered, that number is going to change, that number is going to go up,” Pulse said.
Even businesses that do carry cyber-insurance worry their coverage won’t be enough.
“Our current policy, I think, only covers $50,000 I think. Well, that’s a drop in the bucket for damages that we could incur if we had a major cyber attack, it could effect our whole business,” Lori Olson of Van Buskirk Companies said.
Experts acknowledge that the added cost of cyber-insurance can be a deal breaker for many small businesses. But they say premiums may go down as more and more companies become better at protecting themselves from hackers.
“And your defense have to be up all the time, you can never let those down, ever,” Olson said.
Around 80 companies offer cyber insurance.
The stakes are high: speakers at the workshop pointed out that one-in-five small businesses fall victim to hackers and more than half of them go out of business within six-months of the attack.