How much could your business save?Find out now!
Or, you can call us on:0800 411 8830

The TalkTalk case and cyber liability: why your SME is at risk


The recent cyberattack on telecommunications giant TalkTalk highlights the vulnerability of large companies to digital crime. With such a well-resourced company allegedly falling victim to a 16-year-old boy, how can your company find protection?

Cybercrime on the rise

Cybercrime is a growing concern in the UK – so much so that the Office of National Statistics (ONS) recently commissioned a large-scale survey to investigate the figures for fraud and crime falling under the Computer Misuse Act.

The results were eye-opening. The ONS’s field trial showed that the past 12 months saw up to 5.1m incidents of online fraud, involving 3.8 million victims, and that over half of these involved some initial financial loss.

The survey looked at different types of digital crime, including:

  • fraud
  • the hacking of email accounts and social networks
  • the infection of a victim’s computer or other internet enabled device by a virus

 

An immense amount of personal – and corporate – information is under threat. Is your business protected?

Cyber crime and SMBs

Many SMEs overlook the issue of cyber crime, assuming the targets to be large corporations, or at least those who who operate in the IT or telecoms sectors.

In fact, SMEs are usually more at risk than larger firms. Why? SMEs often hold valuable data, such as financial information and client records, but generally don’t have the resources to protect it.

If a telecommunications giant like Talk Talk, with dedicated IT teams and sophisticated encryption software, can be a victim of a serious cyber attack, imagine how vulnerable smaller companies are.

Yet a startling number of SMEs do little or nothing to protect themselves against cyber crime.

What can SMEs do to protect their cyber assets?

Other than preventative IT measures, one simple way for companies to mitigate against damage is by investing in cyber liability cover.

At the moment, cyber liability is the most under-purchased of all important insurance covers. However, this might be set to change if a new law governing data breaches comes into force in Britain.

Cyber breaches and the law

In the US, most states already have mandatory requirements for data breach notification – meaning that if a company sustains a cyber attack, it must notify its clients. Such a law doesn’t yet exist in the UK but a recent Computer Weekly article highlighted an impending draft of EU Data Protection Regulation, which includes mandatory notification of cyber breaches.

Whether the law goes ahead or not, companies that are directly or indirectly responsible for the loss of client information may be liable to pay heavy compensation costs.

Imagine an import-export business unintentionally leaked sensitive information about its suppliers, leading to fraudulent attacks. The supplier could hold the import-export business responsible and sue for huge damages.

Or imagine a garage that had its client data stolen, leading to customers’ bank accounts being hacked. A single, relatively small incident could put the garage out of business.

Cyber liability cover: peace of mind

In both the examples above, cyber liability cover would go a long way to protecting the companies, compensating them for damages and legal fees.

While insurance brokers have been offering cyber liability cover for years, businesses of all sizes have been slow to take advantage of it – and many have suffered significant financial loss as a result.

The attack on TalkTalk shows that it’s time for SMEs to sit up and take notice of a very real menace. But rushing to buy an off-the-shelf product could be a false economy. The rapid evolution of cyber threats, combined with the unique exposures of SMEs offering different products and services, makes getting advice a good idea.

 

Related Articles

energy news 240217

Energy News – 24/02/2017

What’s been making headlines across the energy world this week? We round up the big stories from the las...

Read More
content calendar download

Free Content Calendar Download

This month we have a free content marketing calendar download for our blog readers and newsletter subscribers....

Read More
Renewable energy sources: what is hydropower?

Renewable energy sources: what is hydropower?

Energy generated by water has been used for thousands of years but only recently to generate electricity. We t...

Read More
Excellent, 9.7 / 10

Excellent communication and help

"The service was always efficient, emails were tesponded to quickly and efficiently. Would definitely recommend"

This review was posted by Nella Mcgregor on the 27th of February 2017

Great Service

"Jessica Purnell was great, she was helpful and everything was easy. I have saved £150 per month! many thanks Jess :-)"

This review was posted by Melanie Baker on the 23rd of February 2017

Thank you Jess Purnell!

"Jess really helped us out with switching suppliers... she wasn't pushy at all and the service was great. Thanks again!"

This review was posted by Becki on the 23rd of February 2017

Thanks for your help Mark Weeks and Switch My business

"I would like to thank Switch My Business and particularly Mark Weeks for the ease of switching and saving me money! I can highly recommend them. Thanks again Richard Blake"

This review was posted by Richard Blake on the 22nd of February 2017

Aaron Gallagher

"Aaron sorted out a new electricity deal for my church, enabling us to make good savings. We have now received confirmation of our new 3 year plan.During our telephone conversations Aaron was always very polite and efficient. Dawn Marskell"

This review was posted by Dawn Marskell on the 21st of February 2017