Key Points
- Four out of 10 SMEs fell victim to cyber attacks last year.
- Cyber insurnace can cover businesses against identity theft and data breach.
- Policies can cost up to $900 and up.
'May PERAan' is SBS Filipino's podcast series which features financial experts seeking to answer the most common questions about money and finances.
Listen to the interview
Paano mapoprotektahan ng cyber insurance ang iyong online business?
SBS Filipino
09:00
"Cyber attacks are inevitable these days as we all have our personal data stored online. Cyber insurance ensures against financial loss from a cyber attack and human error," insurance broker Richard Labrador shares.
According to Labrador, while thieves could threaten physical injury when taking from a physical shop, the issue online businesses now face are hacking and blackmail.
Four out of 10 SMEs
"Studies have shown that four out of 10 SMEs have fallen victim to cyber attacks in 2021. These are only the ones that have been reported," Labrador says.
Through these attacks, payments and client information can be hacked, invoices can be intercepted and, account details changed.
"Last year, the reported that individuals and businesses lost around $33 million due to cyber attacks."
Common types of cyber attacks
Labrador says that one of the most common types of cyber attacks are socially engineered thefts. These are ways of manipulating human error to gain information and access to a system.
"An example of this would be criminals intercepting your email and changing the account information in an invoice.
"Tax lodgement forms can also be faked. They make documents look authentic and tell you that you have outstanding taxes."
What cyber policies cover
Labrador shares that cyber policies typically cover business interruption loss when systems shut down; financial loss due to lack of productivity and; identity theft.
"If your data is breached and employee information is compromised, the financial loss of the employees are also covered.
"If there was a breach of the privacy act or privacy error…let's say, you accidentally send sensitive information to other people or to clients, you may need to advice the about it."
Budget allotment for cyber insurance
According to Labrador, "Cyber insurance can sometimes be included as an extension in your existing insurance, but coverage is limited. I think it's better to have a standalone policy so that there is better protection for the business."
The cost of policies will depend on turnovers, systems protections in place, malware, protocol in money handling and employee awareness when it comes to cyber risks.
"Conservatively, cyber insurance can cost $900 and up.
"Remember that an anti-virus program can help manage security risks, but it won't be able to help you once data is breached and compromised."
Disclaimer: The information in this article serves only as a guide. For additional information regarding your particular issue or situation, consult with legal, financial and/or tax experts.
