Cyber security has become top of mind for businesses, big and small. How can you protect your enterprise against cyber-crime?
In part one of our article on the risks businesses face today, we discussed how you can protect the reputation of your business against damaging social media interactions. In this article, we explore a risk that can damage your business to the core – cyber-crime.
Digital disruption has powered the rapid rise of innovative start-ups – making it easier for agile businesses like Uber or AirBnB to enter the market with relatively low capital and infrastructure needs. But, with the rise of digital technologies comes a real risk for businesses – cyber-crime, hacking, viruses and malicious codes.
South Africans, for example, lose more than R2.2 billion to internet fraud and phishing attacks a year, and the country is ranked third on the Cyber Exposure Index.
What happens to a small business when they fall victim to a cyber-attack?
Discovery Insure CEO, Anton Ossip, says it is important that small businesses do everything in their power to protect themselves and their clients from potential cyber-attacks.
He says: “Small businesses will usually have a few computers they rely on for their daily operations. A cyber-attack to these computers will mean that the business cannot operate optimally until they can fix the affected computers. They could also lose essential data – including their clients’ data – which could expose their clients to illegal activities.”
“A cyber-attack on a small business will lead to interruptions in normal business operations,” he continues. “This is likely to lead to loss of revenue or loss of profits, which may even cause the small business to fail.”
The legal repercussions of a cyber-attack on your business
Human error by management or employees can lead to a cyber-attack like a hack, virus or malicious code affecting the computer system. However, cyber-attacks can happen even in the absence of human error.
Ossip explains that a cyber-attack can lead to system damage and to loss or theft of confidential and personal information stored on the computer system. This could be clients’ information or information that belongs to the business.
If a cyber-attack happens, a third party whose data is compromised may sue your business, resulting in legal costs. The business may also be found liable to compensate the third party for any losses they incurred following the attack.
“For example,” Ossip explains, “A computer system is hacked and as a result clients’ credit card information is stolen. This leads to money being stolen from these clients. The business may be liable to compensate them for the financial loss they suffered.”
How can SMEs safeguard themselves against cyber risks?
“SMEs are most vulnerable to cyber-attacks because they often do not or cannot invest in the appropriate security,” Ossip says. “SMEs need to make sure they have sufficient cyber insurance cover according to their unique business needs.”
Ossip says it is also important to have adequate cyber security to prevent a cyber-attack: “This is why we have partnered with an expert IT service provider, AVeS Cyber Security, to offer Discovery Business Insurance clients cyber protection packages at highly discounted rates to help our clients manage their cyber security and lower the associated risks.”
Having cyber insurance gives SMEs the benefit of recovering quicker following an attack. “Small businesses need cyber insurance cover precisely because cyber-attacks can and do happen, even if the business has cyber security in place,” concludes Ossip.
Don’t let cybercrime end your business – make sure you and your clients are protected from these attacks.
About business insurance from Discovery
We understand that different businesses have different needs. That's why we give you comprehensive, yet flexible, insurance cover that is tailored to your business and considers the business risks you face in a modern, fast-paced world. You'll get business insurance that is driven by technology and built on a model that shares value for managing your business well. Through our partnership with Endeavor South Africa you'll have access to a diagnostic tool that will help you identify key areas of development so that you can grow your business. In addition, you will get access to service providers, at a preferential rate, who can help your business develop in the right direction. To find out more, speak to your broker or contact us and we will help you.
Discovery Insure's Impact Alert sends help when you need it most
Wish you had the technology to call for help when you most need it? Discovery Insure's Impact Alert feature can detect when you've been in an accident. If we can't get hold of you immediately, we'll send emergency assistance to your location, while our Vehicle panic button can be used to alert emergency services when you're in your car and need help.
In South Africa’s entrepreneurial landscape, good financial planning is important when it comes to making small businesses not simply survive, but thrive.