Cyber liability and cyber security are becoming pivotal factors for businesses of all sizes. Until a few years ago, these aspects weren’t significant concerns. However, today, they hold more weight than many other determinants of a business’s success. Reports indicate that a staggering 60% of businesses facing serious cyber attacks end up closing within two years.
The Elements of Cyber Security and Liability
Four critical elements encompass cyber security and liability concerns for businesses:
- Prevention: Implementing basic measures like two-factor authentication, physical security of equipment, regular software updates, and active monitoring are crucial. Relying solely on an in-house IT person isn’t adequate due to the evolving nature of cyber threats. Third-party active monitoring, often provided by cyber liability insurance, is essential.
- Mitigation: This involves strategies to limit damage when a cyber event occurs. Active response teams from insurance policies, robust backup systems, failover hardware setups, and best practices for immediate response within the organization are key to mitigating damage.
- Response: After an event, a structured response plan is crucial. Immediate deployment of additional hardware, notifying affected parties (a legal requirement in many states), and conducting thorough checks on all connected devices are essential steps in the response phase.
- Viability and Resilience: Lastly, having a contingency plan for worst-case scenarios ensures business viability even after a catastrophic cyber event. This includes having capital reserves, alternate financial pathways, and possibly insurance coverage specifically for cyber liability.
The Crucial Need for Preparedness
Being prepared across these four fronts can significantly minimize the impact of cyber attacks on a business, safeguarding not just the company’s interests but also the livelihoods of employees, clients, and vendors. While businesses prepare extensively for physical threats like fires or natural disasters, their readiness for cyber threats often falls short.
The Urgency for Cyber Readiness
The probability of a cyberattack impacting a business is increasing, making preparedness a critical aspect of ensuring business continuity. Investing in cyber security measures is as crucial as having fire insurance or emergency response systems in place. Businesses must acknowledge the inevitability of cyber threats and be adequately equipped to combat them to protect their operations and stakeholders.