In light of the recent global ransomware cyber-attack, many small and mid-size businesses should take cautionary note…don’t get caught off guard as every business is at high risk from these attacks. Although large corporations seem more prepared, the smaller businesses are taking out less policies for cyber warfare. Regardless of the size of the business, everyone needs to be insured.
These attacks have been indiscriminate and not directed at any particular company. The hacking is more automated so you end up with smaller companies experiencing disruptions and outage and having to pay extortions.
Interestingly, companies that have been attacked who actually paid out or filed claims is relatively low. And in case you were wondering what the cyber criminal’s payment of choice – it’s Bitcoin.
However, cyber attacks deliver other potential problems relative to insurance pricing. Underwriting cyber insurance is challenging to say the least. These attacks might bring to light that rates are getting too low and perhaps insurers need to be cautious.
Rate pressures are increasing as the market quickly grows. Nonetheless, the rates aren’t reflecting the substantial exposure from these attacks. These hackers aren’t using tools to attack one particular company, rather they use self-replicating viruses immediately spreading through the internet hitting millions of computers. So, when you have an automated malicious attack that targets vulnerability, there is definitely cause for alarm and a call to all companies, regardless of size, to protect and insure themselves.