Both large and small companies are targeted by cyber criminals, and it’s clear no one is safe. Each year attacks become more frequent and more expensive. 

Why should small businesses be worried?

Small businesses possess valuable data

Many companies store their customers’ and employees’ information. This information can be exposed through loss, physical theft, hacking, or accidental publication. If a data breach occurs and private information, such as a social insurance number or bank account number, were to be stolen, the information could be used for fraud, and the business that was storing the data could be held responsible for all costs associated with the data breach.

Cyber attack costs could cripple small businesses

Cyber attacks can lead to huge financial losses that small businesses especially may not be able to recover from.

Cyber attacks can halt operations

Almost a third of cyber attacks lead to a company having to stop their operations. ¹ Most businesses are completely dependent on technology and are unable to run without access to their computer systems. Every day without access means lost income. Ransomware attackers tend to target businesses that cannot afford long interruptions to their operations. ² These companies are more likely to send ransom payments right away to regain access to their computer systems. 

When a cyber attack occurs, what expenses are businesses often hit with?

• Hiring third-party experts to provide services such as forensic IT, credit monitoring, case management, legal counsel, negotiation, investigation, and public relations
• Breach notification costs to those affected by a data breach, and possible lawsuits and reputational harm
• Regulatory and Payment Card Industry fines and penalties
• Data restoration and re-creation costs
• Costs to get computer systems up and running again, and upgrades to help keep bad actors out
• Ransomware payments to cyber criminals
• Judgements from provincial or regulatory agencies
• Business interruption costs

Because small businesses are especially vulnerable to cyber attacks, we’ve spotlighted specific loss stories and how cyber coverage has helped them recover. See their stories here:

Sources:

¹ IBAC, Cyber Risk and Insurance Report 2023

² IBM Security, Cost of a Data Breach Report 2023