Cyber Risk

As technology advances, cyber risk grows. No business is immune to the threat of cybercrime – let our industry expertise, preferred brokers, and tailored insurance coverage help protect your company from digital disaster.

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What is cyber risk insurance?

In the digital age, it becomes necessary to broaden your business coverage to protect your bottom line and your reputation. Cyber risk insurance is designed to support your business if computer networks are breached, causing information to be stolen or ransomed, business operations to be interrupted, computer systems to be corrupted, and other serious professional consequences.

Cyber risk coverage doesn’t stop at the event, because consequences can stretch on for much longer. Aside from regaining access or recovering lost information, your business may need to deal with things like network repair, legal claims, and public relations services to help restore your reputation and rebuild trust among customers. Getting things back on track can take days, weeks, or months.

What exactly is “hacking”?

You’ve heard the term before, but what does it really mean? Hacking is a type of criminal behaviour that can prey on a computer system or network in a few distinct ways:

  • Exploits: programs or actions that find and manipulate security flaws on a system’s software or network software.
  • Malware: software designed to gather info, destroy, encrypt, or otherwise incapacitate your digital network.
  • Human: a person who physically breaches security measures to steal or corrupt data.

Cyber risk coverage can involve things like:

  • Corrupted data
  • Lost devices
  • Computer malware
  • Stolen information

But this isn’t an exhaustive list of risks and targets. Consider the following realities of cybercriminal activity today and scenarios where cybercrime could endanger your business.

Who needs cyber risk insurance?

Do you handle information electronically? Unless you’re still using pencil and paper to facilitate, record, and process transactions, your data is likely vulnerable. A business doesn’t need to be rooted in the tech sphere to be prone to cybercrime – any business that uses computers is exposed to cyber risk.

Big or small, thieves want it all - cyber risk insurance

Big or small, thieves want it all

Hacks of big companies tend to make the headlines, but small and mid-size businesses are equally prone to cybercrime. In fact, attacks on these types of companies account for 61% of all cyber attacks.1

Cyber incidents impact companies across all industries, and they can take a variety of avenues. Email is a favourite tool among thieves trying to access your system, and once they’re in, they can unleash malware, ransomware, and other malicious programs to cause trouble.

All it takes is one targeted attack to sideline your small business: the average business downtime from a breach is 23 hours.2 Even if you manage to get back up and running quickly, expect to face costly consequences, since the average cost of a breach response is $6.11 million.3

Formjacking: a retailer’s worst nightmare - cyber risk insurance

Formjacking: a retailer’s worst nightmare

In Symantec’s most recent Internet security report, formjacking takes centre stage among emerging digital threats. In contrast to cryptojacking (where criminals mine a device for cryptocurrency), formjacking plants malicious code on a retail website to grab the credit card details of shoppers. It’s a relatively simple way to extract a fortune from an online retailer.

Small and large companies alike can be prime targets, and you might be surprised at the amount at risk: on average, over 4,800 unique websites are compromised each month with formjacking. Since this type of cyber attack is a serious threat for both businesses and consumers, people on either side of a transaction need to be wary.

Did you know?

You have a responsibility to deal with cybercrime quickly. If you fail to comply with Canada’s mandatory privacy breach reporting and record keeping laws, you could face a fine of up to $100,000.

Here are some circumstances where cyber insurance coverage can come into play:

Rogue employee

Imagine one of your employees had violated company policy by accessing customer data and selling it to a third party. Depending on the size and nature of your system, hundreds or thousands of customers could be affected.

After the employee is caught and fired (and criminally charged), you may need to hire a public relations firm to communicate with the public and work to restore trust – but even that may not be enough to avoid a multimillion dollar class action lawsuit from the affected customers.

Business interrupted

Consider a mid-sized manufacturing business that relies on multiple computer systems to organize their metal parts manufacturing operations. A cyber criminal managed to introduce malware to all the systems, forcing the company’s IT department to spend days recovering electronic data from corrupted storage devices and repairing the computer systems to continue operations.

Each day that the business is closed is a day of lost income. But that’s not all: contract deadlines could be missed during that time, which means vendors can experience lost income and delays of their own. In the end, one malware attack could lead to an expensive loss encompassing cost of forensic investigation, legal expenses, business income loss, and even litigation from vendors for breach of contract.

Software repair

Cybercrime comes in all sorts of forms. If a small professional services company was hit with a denial of service (DoS) attack, which hackers use to make a machine or network resource unavailable to the user or owner, they may have to shut down operations for a while for repairs. In this case, the work related to fixing the software would be covered by a cyber risk plan.

How can we help?

Keeping your guard up can be a full-time job, but we can help ease the burden with smart and focused cyber support. From ransomware to lost devices, we’ve got you covered with first-party* and third-party** cyber coverage, plus protection for the data stored on your system or on another system – no matter where in the world it’s located!

Need a special solution? Our standard package will suit most small and mid-size businesses, but a larger operation might need a custom policy – we offer tailored custom solutions for businesses like these.

Recover rapidly with Cyber Assist – at no additional cost!

Services include:

  • Pre and post-privacy breach services
  • Incidence response planning
  • Crisis management
  • Notification assistance
  • Media relations consulting

Northbridge Cyber Risk policyholders can make use of Cyber Assist services, provided by leading data risk management service provider, CyberScout. CyberScout can consult with you on proactive measures to protect your business, as well as reactive assistance in the event of a privacy breach.

Want more cyber resources? Policy holders will also have access to CyberScout’s secure website, which includes educational resources, data breach regulations, customizable templates, and self-risk analysis.

What can a broker do for me?

An insurance broker can be your greatest asset when it comes to finding the right insurance policy. A broker brings a wealth of insurance expertise, product knowledge, and personalized service to the table, working to protect your company and your peace of mind.

Northbridge believes in the power of strong partnerships. Our preferred network of reputable brokers can help craft a comprehensive policy that’s suited to your unique business.

Are you managing your risk?

Risk is a part of life – risk management should be, too.

Risk is a part of life – risk management should be, too. It can be challenging to make space for risk mitigation in your daily routine, but this is a corner that shouldn’t be cut. After all, even if you have the right insurance coverage, preventing a loss is always better than recovering from one.

Risk management solutions can be as simple as improving the layout of your workspace, or as involved as launching a company-wide training program. Our Risk Services experts can help with both. In fact, we’ve made access to risk management expertise a fundamental feature in every commercial insurance policy.

Whatever the size and nature of your business, it’s important to stay protected. Not sure where to begin?

Let’s get started!

1 Verizon 2017 Data Breach Investigations report

2 Stats Canada – Impact of cybercrime on Canadian businesses, 2017; Released 2018-10-15

3 IBM Ponemon Institute’s Cost of Data Breach study, 2017

*first-party cyber coverage: covers consequences that impact your business operations, including expenses related to incident response, data recovery, business interruption, and extortion.

**third-party cyber coverage: covers consequences that impact a third-party (such as customers or vendors), including costs related to network security and privacy liability, internet media liability, and regulatory expenses.

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