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Cyber attacks have increased over the past 18 months, thanks in large part to the pandemic and the rise in people working from home.  

And while many companies may assume they’re covered by their insurance, that is not necessarily the case.

Concept IT managing director Kevin Embleton discusses how managed IT services can make sure you’re not left short should the worst happen.

Faced with rising demand for cyber security payouts rises, some insurance firms are now cutting the amount of cover they offer after being hit with substantial payout bills.

In November, Reuters reported that a number of insurers were increasingly reluctant to cover cyber crime, as attackers became more sophisticated and attacks became more common.

The report also noted that many firms operating in the Lloyd's of London market are starting to charge higher premium rates to cover ransoms, the repair of hacked networks, business interruption losses and even the PR fees incurred as firms attempted to repair their damaged reputations.

“Insurers are changing their appetites, limits, coverage and pricing," Caspar Stops, head of cyber at insurance firm Optio, told Reuters. “Limits have halved – where people were offering 10 million pounds ($13.50 million), nearly everyone has reduced to five.”

One of the most common types of cyber crime targeting businesses is ransomware, a type of malware from cryptovirology, that threatens to publish the victim's personal data or perpetually block access to it unless a ransom is paid.

In October, a European Union report said that the Covid-19 pandemic and attendant rise in home working had led to the prevalence of cyber crime.

Meanwhile, cyber security firm Coveware compared ransomware attacks to the Colombian cocaine cartels in the 1990s, with both types of crime enjoying profit margins of around 90 per cent.  

And while previously hackers had used more wide-ranging tactics, there are now signs that they are coming up with more targeted approaches, reading balance sheets and focusing on specific sectors.

While anyone can be a victim, it is most commonly aimed at businesses that hold a lot of sensitive and necessary data, such as healthcare, IT and manufacturing. 

The hackers themselves are also getting increasingly sophisticated, with some reports even suggesting that attackers may even check whether potential victims have policies that would make them more likely to pay out.

How to prevent fraud

To ensure you’re covered in case of an attack, the Government’s Cyber Security Centre has the following advice.

Firstly, make sure you identify exactly what within your organisation needs protecting the most, and to also identify any what the worst-case scenario would be.

Secondly, don’t just limit yourself to meeting the minimum cyber security requirements specified by an insurer; these might not adequately protect the things your organisation cares about.

Thirdly, another way to cover yourself is by already having recognised cyber security systems such as Cyber Essentials in place – some insurance companies even offer discounts for those firms that have the accreditation. It is a minimum standard created by the UK government to help safeguard business and at Concept we encourage every organisation we work with to adopt this initial standard.

When it comes to taking out a policy, it is up to the policy holder to ensure their cyber security details are accurate. Insurers need to understand what cyber security measures you have in place, and if your circumstances change so that you're still covered.

That’s because if you falsely (whether knowingly or not) claim to have security measures in place, the insurer may not be obliged to pay any claims.

One way to make sure you do have everything in place is to invest in managed IT services.

At Concept, we look after every aspect of our clients’ IT needs, with Webroot anti-virus and malware protection keeping systems protected from intrusion, malware, virus and downtime, giving staff the confidence to work the way they need.

For more information about how Concept can keep you and your business safe, visit www.concept-its.co.uk/