Does Your Business Need Cyber Insurance?

Technological advancements have made our everyday routines more convenient. However, these breakthroughs have also opened the door for cyberattacks.

Fraud is the most common type of cybercrime in Canada, with the data breach costing businesses an average of 5.13 million USD. Unfortunately, in 2024, it’s no longer a matter of if a cyberattack will impact you, but when.

So, with that all being said, who needs cyber liability insurance? In this blog, we’ll walk you through several businesses that can benefit from this policy!

An Overview of Cyber Insurance

Cyber insurance is designed to protect businesses and individuals from the financial losses incurred as a result of cyber-related threats and incidents. It protects them against and during situations wherein a cyber attack could lead to data breaches, theft, system hacking, ransomware extortion payments, or more.

Typically, any business that stores sensitive information like client data online or on a computer is at risk of a cyber attack and needs cyber insurance coverage. However, some businesses are more vulnerable to cyber attacks than others.

A Compliment to Existing Security Measures

Here’s an alarming statistic: from 2022 to 2023, the amount of data breaches reported by Canadian businesses increased by 130%.

So, if you’re asking, “Who needs cyber insurance?”, the clear answer is everyone running a business in Canada. This also includes businesses that have already invested in cybersecurity—insurance goes hand-in-hand with these measures.

While security software can be a great deterrent, would-be hackers are only getting better at what they do.

There’s also the developing relationship between AI and cybersecurity to consider. Automation is helping cyber criminals streamline their efforts and processes, while also providing completely novel avenues to commit online crimes.

Think about it this way: while, yes, you could go outside in the cold with only a coat, you’ll feel much better if you’re also wearing a hat and gloves. Cyber insurance provides you with an extra layer of protection that makes a difference.

So, Who Needs Cyber Insurance?

Almost any business, no matter its size, can be at risk of a cyber-attack. Here are some types of businesses that should consider it first and foremost.

Small Businesses

Small businesses are especially at risk, with 45% of them having reported experiencing a cyber-attack at the end of 2022. Without cyber security measures in place, most small business owners run the risk of filing for bankruptcy.

Cybersecurity threats for small businesses include:

• Data breaches
• Malware incidents
• Ransomware attacks

All of these attacks can be damaging and expensive to recover from. There’s also the risk of lawsuits being filed against you if your client’s personal information is compromised in the data breach, leading to high legal fees and other costs.

When asking, “Who needs cyber liability insurance”, you also have to consider your reputation and responsibilities as a business. How will you, in good conscience, be able to connect with customers if you’re making their information vulnerable, whether that be their credit card numbers or emails? Protect yourself!

Hospitals and Healthcare Facilities

Hospitals and other healthcare facilities are also at risk of being targeted by hackers. Compromised patient data is highly disruptive, often impacting those who need urgent medical treatment and can even be life-threatening in some cases.

These facilities are prime targets for cybercriminals because they know that when they attack them, national regulatory bodies or even the government may get involved—and they’ll likely be able to pay them a hefty price to undo the damage.

Cybersecurity threats for hospitals and healthcare facilities include:

• Compromised patient records
• Malware rendering important data unusable
• Cyber extortion using sensitive data

As you can imagine, the leaking of private information, in particular, can have catastrophic consequences for those involved.

As such, many healthcare facilities and organizations are left paying hefty fines related to data breaches. Healthcare professionals also risk facing hefty legal fees and lawsuits if their clients feel as if they’ve been negligent in protecting their medical records.

Medical Spas

Although they operate on a smaller scale compared to hospitals, medical spas also deal with the health and safety of their clients. This means that a potential data breach or cyber attack could lead to lengthy legal battles and heftier fines.

Cybersecurity threats for medical spas can include:

• Compromised patient records
• Stolen intellectual property or assets
• Scams propagated through stolen contact information

As such, the medical professionals who work in spas need to take extra precautions to ensure they’re protecting their online data. In 2022, human errors—classified as negligent actions by employees or contractors—were responsible for 21% of breaches.

Training staff in basic cybersecurity can help in reducing cyber threats, but advocating for best practices can only go so far. Cyber liability insurance coverage is a better way to protect your people and your business if and when a mistake is made.

Protect Yourself With Cyber Insurance From KASE

So, as you’ve learned, the answer to the question, “Who needs cyber insurance?” is everyone. Businesses of all sizes across several industries can greatly benefit from having customized cyber insurance because of how unpredictable technology works.

At KASE Insurance, we provide our clients with comprehensive cyber insurance packages catered to their specific needs. We have years of experience mitigating cyber risks, meaning our policies always stay ahead of the curve. No matter how technology changes, rest assured we have your business covered from cyber criminals.

If you would like to learn more about cyber coverage, get in touch with us today. An experienced broker will be happy to assist you!