Cyber Insurance
Recovering from a cyber attack or data breach can be financially devastating.
Lost sales from business interruption, government fines and customer lawsuits, financial losses from fraud, legal fees, compliance costs and reputation damage.
Cyber insurance helps cover these financial costs to keep you in business.
Business Risks
Optus is reported to have lost 10% of their customers after it’s recent cyber security breach. Source: News.com.au, Oct 2022.
- Over 200,000 Australian small businesses have been identified with major network security gaps. Source: Australian Cyber Security Centre (Cyber.gov.au) Annual Cyber Threat Report, June 2022.
Government Fines
In May 2022 ASIC sued RI Advice Group in Federal Court for poor cybersecurity. They were found in breach of their financial services licence having to pay ASIC $750,000 in costs. Source: ASIC.gov.au, May 2022.
- In Dec 2022 the Australian government increased the minimum fine for a major data breach from $10M to $50M under the Privacy Act.
Legal Risks
“Following a ransomware attack directors will need to consider whether it is legal for the company to pay the ransom. If it is not, then directors risk personal liability under ASIC’s stepping stone liability approach.” Source: Tackling Ransomware Threats Report (Homeaffairs.gov.au), Mar 2021.
- Under the Corporations Act 2001: “Failure to… identify and manage cyber risks may… result in you being disqualified as a director.” Source: ASIC report 4291, Mar 2015.
Ransomware Risks
Professional service firms are the most ransomware attacked sector. Attacked by cyber criminals 3 times more than government. Source: ACSC (Cyber.gov.au) Annual Cyber Threat Report, 2021.
- Australia is ranked #1 globally for ransomware attacks. Source: Imperva 2021 Cyberthreat Defense Report.
Email Risks
Over 4,600 reports of email accounts being hacked in 12 months (90 per week) with total losses of $81 million. Source: ACSC (Cyber.gov.au) Annual Cyber Threat Report, 2021.
- Australia is one of the top 5 countries for BEC attacks (business email compromise). Source: ACSC (Cyber.gov.au) Annual Cyber Threat Report, 2021.
Australian Risks
More than 6 million Australian’s were hacked last year (1 in 3) with over 1500 cyber crimes reported every week. Source: Australian National University research, Nov 2022.
Over 76,000 cyber crimes (1 every 7 minutes) were reported last year. Source: ACSC (Cyber.gov.au) Annual Cyber Threat Report, June 2022.
Around 25,000 calls were received by the ACSC hotline (69 calls a day). Source: ACSC (Cyber.gov.au) Annual Cyber Threat Report, June 2022.
- Cyber threats now rank in the top 3 business risks globally. Source: Allianz Risk Barometer 2021.
What is Cyber Insurance?
Cyber insurance provides cover for cyber related events such as data breaches and cyber attacks (ransomware, cyber crime, email fraud, etc). It's important to know most business insurance doesn't cover these cyber events.
In fact, nowadays most business policies specifically exclude cyber incidents (eg; your PI insurance excluding cyber crime). Even if you have business interruption insurance it will only include physical events not digital disasters.
And third party risks are not covered either (eg; client lawsuits and damages claims for exposing their data). In addition, business data is not tangible so property insurance won’t help you either.
In short, you could have some large gaps in your current insurance coverage.
What types of Cyber Insurance do Kaesim offer?
Kaesim has partnered with a leading insurance broker to provide you the best value for money and fit for purpose cyber insurance products in the Australian market.
There are more than 14 cyber insurers currently so it's important you shop around for the best value.
Every cyber insurer has different cover options, policies and compliance requirements. All policies are not the same, and policies change regularly.
For example: cyber-crime cover is very important but not all insurers include it.
And cheap policies don’t include supply chain cover which you may also need.
What happens if you get hacked now but suffer financial losses later? Many insurers don’t cover this loss.
And automatic reinstatement policies are better than aggregate policies however they’re more expensive. Yet some insurers offer these reinstatement policies cheaper to win market share.
So shop around. It’s a relatively new type of insurance so prices can vary greatly and what's included.
And use a broker who specialises in cyber insurance, not a general broker. It's a specialist product that needs technical expertise.
What Cyber Insurance Covers
Cyber liability insurance typically covers these financial costs to your business:
- Income losses from business interruption.
- Financial losses from cyber fraud/crime.
- Ransomware payments.
- Legal fees including liability costs.
- Client lawsuits and damages claims.
- Government fines (ASIC, APRA, ACCC, Privacy Act, NDB Scheme, etc).
- Public relations costs for managing reputation damage.
- IT system repair and data recovery costs.
What does a Cyber Insurance Plan cost?
The cost of cyber liability insurance depends broadly on three factors being:
- The size of your business (annual revenue).
- Your industry type.
- Your current cybersecurity.
So a very important factor in how your premiums are calculated is: the better your cybersecurity, the lower your premiums could be.
And best of all your cyber insurance policy includes a free law firm, forensic IT team, and public relations agency supporting you all the way.
You'll have the support of these three adviser teams by your side 24/7 at no extra cost.
In addition, your policy includes 24/7 Dark Web monitoring to help protect your brand and reputation from hackers selling your stolen data online.
And our cyber insurance expert can provide you free insurance quotes or review your existing policy at no charge.
How Cyber Insurance Mitigates Risks
Cyber liability insurance mitigates (reduces) the impact of cyber crime by covering your financial costs when a cyber attack or data breach occurs.
So you'll have peace of mind knowing the financial burden is covered.
And because your cyber insurance policy includes a free law firm, forensic IT team, and public relations agency you won't need to worry about questions like:
- Legal: If a ransom payment is demanded, what are the legal consequences of you paying (or not paying) the hackers?
- Forensic IT: Who will investigate the data breach to determine fault and liability for legal and insurance purposes?
- Public Relations: How will you disclose the data breach to your clients, partners and the government? How will you communicate effectively and legally?
You need cyber insurance as part of your cyber risk strategy to protect your business from digital disasters. Just like you need fire insurance to protect your home/office/factory in the event of a fire.
Why choose Kaesim for your Cyber Liability Insurance
There are three reasons why you should choose Kaesim to help find the right cyber insurance policy for your business:
- Lower insurance premiums.
- Specialist expert advice.
- Staying compliant.
Firstly, our award-winning cybersecurity means you could avoid paying higher insurance premiums because of poor cybersecurity.
The better your cybersecurity, the lower your insurance premiums could be.
Secondly, our partner is one of the few insurance brokers in Australia who specialises exclusively in insurances for emergent risk: cyber insurance, cyber fraud, reputation management, etc.
They've personally researched the US and London insurance markets and established relationships with local and international underwriters.
Their industry knowledge and experience includes:
- Finalist: Cyber Insurance Security Professional of the Year (2023 Australian Cyber Security Awards).
- Digital insurance specialist with 10 years experience in data, privacy and cyber insurance industry.
- Cyber insurance speaker for Victorian Law Institute, Macquarie Bank, AISA CyberCon, Victorian Chamber of Commerce and Industry, CISO Leaders Summit, Cyber in Business Conference, etc.
Most insurance brokers are not specialists in cyber insurance which is complex and easy to get wrong. Using the wrong insurance broker means you risk being non-compliant and having future insurance claims rejected (and waste the money you've spent on the insurance premiums).
Thirdly, we help with the technical questions on your insurance proposal form.Getting these questions right is important for staying compliant and keeping your premiums as low as possible. Errors or omissions can mean higher insurance premiums and future claims being rejected.
We help you stay compliant on the technical side of your policy.
We see many people paying for cyber insurance that is worthless because they’re non-compliant causing the policy to be void.
General advice warning: The above information is general in nature and does not take into account your personal objectives, financial situation or needs. You should seek financial advice from a licenced adviser and read the relevant product disclosure statement (PDS) before making any decisions.
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Frequently Asked Questions
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