When it comes to corporate cyberattacks, you likely think of a massive-scale incident aimed at a Fortune 500 company. After all, that’s what you see in the news. However, the reality is that most of these attacks target small businesses. Small businesses have weaker (or sometimes no) cybersecurity than larger ones, making them more vulnerable to cybercrime.
As an insurance partner to many small businesses, we have seen the real damage that comes with a cyberattack. Let’s dive into the reasons why small businesses are at risk and ways you can protect your own small business from cyber criminals.
Why Small Businesses are at Risk
Cybersecurity threats are a growing concern for businesses of all sizes. However, small businesses are often more at risk than their larger counterparts due to several key factors. Understanding these vulnerabilities can help small businesses take appropriate steps to bolster their defenses and protect themselves against potential cybercrimes.
Lack of Resources
Operating on a tight budget is a common reality for many small businesses. They carefully allocate funds to cover essential costs such as salaries, rent, inventory, marketing, and more. This often leaves little room for additional expenses like investing in robust cybersecurity measures or even a full-time IT professional.
Cybersecurity isn’t just about installing antivirus software on company computers. It encompasses a wide range of practices and tools, including firewalls, data encryption, secure cloud storage, regular system updates, employee training, and more. These services can be costly, especially when they need to fit a specific business’s needs and risk profile.
Time is also a limited resource for many small business owners. Implementing effective cybersecurity measures requires time to research the best solutions, set them up, and maintain them. For a small business owner, finding this time can be challenging.
This lack of resources can result in small businesses opting for less effective cybersecurity solutions, or worse, neglecting cybersecurity altogether. This makes them prime targets for cybercriminals who are always on the lookout for vulnerabilities to exploit.
Limited IT Expertise
Small businesses often operate with a lean team, with employees wearing multiple hats to keep operations running smoothly. As a result, these businesses lack a dedicated IT department or in-house experts who can manage and update their cybersecurity infrastructure. This absence of specialized knowledge can lead to significant security gaps that cybercriminals can exploit.
In addition, managing a business’s cybersecurity infrastructure requires staying abreast of the latest cyber threats, understanding the business’s unique digital vulnerabilities, implementing appropriate protective measures, and responding swiftly and effectively when breaches occur. These tasks require a high level of expertise and continuous learning due to the ever-evolving nature of cyber threats. Without an expert on board, it’s challenging for small businesses to keep up with these demands.
Lower Awareness
For many small business owners, the focus is on growing their business, managing operations, and satisfying customers. This leaves little time to stay up-to-date on cyber threats. As a result, they may not be fully aware of the extent of potential cyber threats, or even recognize the vital importance of implementing comprehensive security measures. This lack of awareness can lead to a reactive rather than proactive approach to cybersecurity, which can be detrimental in the face of a cyberattack.
Easier Targets
Cybercriminals tend to perceive small businesses as easier targets, largely because of the assumption that these businesses lack robust security measures. This perception is not without basis. Small businesses are increasingly falling victim to cyberattacks.
Many small businesses operate under the misconception that they are too small to attract the attention of cybercriminals, leading to complacency in implementing comprehensive security measures. This false sense of security can make them particularly appealing to hackers who find it easier to exploit their vulnerabilities.
Access to Larger Networks
Small businesses often work as vendors or service providers for larger corporations. While this relationship can lead to growth and opportunities for the smaller company, it also poses a significant cybersecurity risk. Cybercriminals may target these small businesses as a backdoor to infiltrate the bigger networks of their larger partners.
The concept of using smaller entities to access larger networks isn’t new in the world of cybercrime. For instance, the infamous Target data breach in 2013 occurred when hackers first infiltrated a small HVAC vendor that worked with the retail giant. Once inside the vendor’s network, the attackers were able to gain access to Target’s network, resulting in the compromise of millions of customer records. This incident underscores how small businesses can be exploited as gateways to larger, more lucrative targets.
The combination of limited resources, lack of IT expertise, and lower awareness make small businesses particularly vulnerable to cybercrimes. However, by understanding these risks and taking proactive steps to address them, small businesses can significantly reduce their exposure to potential cyber threats and secure their digital assets effectively.
How to Protect Your Business from Cyberattacks
Businesses of all sizes are susceptible to cyberattacks, especially small businesses. These attacks can lead to significant financial loss, damage to reputation, and even business closure. To help protect your business from these threats, here are some simple suggestions to bolster your cybersecurity measures:
- Get Cyber Liability Insurance: Cyber Liability insurance can help cover some of the costs associated with a cyberattack, including data recovery and business interruption expenses.
- Educate Your Employees: Regularly train your employees about the importance of cybersecurity. Teach them to recognize and avoid threats such as phishing emails, malicious websites, and suspicious downloads.
- Work with a Cybersecurity Professional: Consider hiring a cybersecurity professional or firm to help protect your business and keep up with the latest threats and security measures. While the expense may seem unnecessary, a cyberattack can quickly cost more than the expense of hiring a professional.
- Develop a Cybersecurity Plan: Have a plan in place for how to respond to a cyberattack. This should include steps to identify the breach, contain the damage, and notify any affected parties.
- Install Security Software: Use reliable security software that offers features like antivirus protection, a firewall, and email filtering. Ensure all software is updated to protect against the latest threats.
- Use Strong, Unique Passwords: Implement a policy for strong, unique passwords across all business accounts. Consider using a password manager to securely store these passwords.
- Implement Multi-Factor Authentication: Where possible, use multi-factor authentication. This adds an extra layer of security by requiring users to verify their identity in two or more ways.
- Regularly Backup Data: Regularly backup important data and ensure it can be easily restored.
- Keep Software and Systems Updated: Regularly update all your systems and software. Many cyberattacks exploit vulnerabilities in outdated software.
- Secure Your Wi-Fi Networks: If you have a Wi-Fi network for your workplace, make sure it is secure, encrypted, and hidden.
- Limit Employee Access to Data: Restrict access to sensitive data to only those who need it. The fewer people who have access to your data, the less likely it is to be compromised.
Remember, cybersecurity is not a one-time effort but an ongoing process. Regularly review and update your security practices to protect your business from evolving cyber threats.
Cyber Liability Insurance from Christian-Baker Company
Cyber threats are an ever-present and evolving danger in our digitally connected world. No matter the size or nature of your business, it’s critical to have a solid line of defense against potential cyberattacks. At Christian-Baker Company, we understand these challenges and offer comprehensive Cyber Liability insurance designed to meet your unique needs.
A Cyber Liability insurance policy can assist in defraying the costs linked to a cyberattack. Moreover, some commercial Cyber Liability policies even provide coverage for business loss during the period your systems are compromised or inaccessible.
Remember, in the realm of cyber security, prevention is key, but being prepared for a potential breach is equally important. Trust Christian-Baker Company to be your partner in this journey, providing the necessary peace of mind to focus on what you do best – running your business.
With access to more than 50 carriers, our team of commercial insurance advisors can help you find the best Cyber Liability policy to meet your needs. Contact us today to learn more about Cyber Liability insurance and how we can help safeguard your business in the digital age.
