Among insurers, cyber crime can go by a few different names – ‘financial crime and fraud’, ‘e-crime’ or ‘computer crime’, to name a few. All of these relate to similar cover with just a couple of minor tweaks.
How can cyber crime affect you?
Most people like to think that this type of crime wouldn’t happen to them, but cyber criminals are clever. Rushing through emails or not paying full attention could leave you exposed to cyber theft, especially if you’re holding large amounts of money and making regular transactions.
Below is an example of a simple yet effective technique used by cyber criminals. We’ve also explained how Cyber & Data coverage would apply in this situation
A junior member of the accounts team receives an email purporting to be from the company director and using a similar email address. In the email, the ‘director’ requests a payment of £10,000 to the accounts noted, for services provided to a client.
The staff member actions the request and makes the transfer. In the days following, an audit picks up the transaction and the error is discovered.
While risk management factors such as calling to verify new bank details and using dual authentication on payments will certainly help to limit your exposure, nothing is ever 100% fail-safe.
In this instance, the investigation into the email address and whether any systems had been compromised would be covered by your Cyber & Data policy. The financial loss of the £10,000 itself would only be protected by taking the optional cyber crime extension.
Should you incorporate cyber crime into your policy?
It’s important to remember that while your Cyber & Data policy covers things like the post-hack forensic investigation, PR, business interruption, legal and regulatory aftermath, it doesn’t cover any financial loss, such as funds stolen during an attack – that’s where cyber crime cover comes in.
With cyber crime cover, your monetary loss is covered from events such as electronic theft, telephone toll fraud, social engineering, and the use of your electronic identity by fraud. Some policies even extend to cover risks outside of your control, such as a client being a victim of social engineering and paying an invoice to an alternative account.
As this type of policy covers the monetary amount lost, and because claims are fairly common, limits tend to be smaller (usually between £50,000 and £250,000 depending on your industry and level of cyber security). Annual premiums start at around £500.
What should you do next?
At RiskBox, we see first-hand how the threat of cyber crime is growing among organisations. And, with the majority of businesses currently operating remotely, there’s an even greater risk.
If you’d like to discuss a new Cyber & Data policy (see the best time to buy this insurance here), or review the suitability of an existing plan, call us today on 0161 533 0411 or email email@example.com.
Agencies - September 25, 2023
Blog - September 11, 2023