Size really doesn’t matter: Why you should never rule out a cyber attack on your micro business

Cybercriminals are finding increasingly sophisticated ways to target micro businesses. Here’s what you need to know to meet those challenges head on.

Today, almost every micro business operates their sales, invoicing and client communications online. It’s efficient, trackable, and allows sole traders to juggle the multiple demands of running a business day to day.

But no operational evolution comes without its own challenges. As more and more businesses have taken to the internet clouds, cybercriminals have uncovered ways to exploit them.

Chatting to Jane Mason, Head of Product, Channels and Risk at Australia’s leading online small business insurance service provider BizCover, we unpacked the rising risk of cybercrime for Australian businesses.

“Australian small businesses are prime targets for cybercriminals,” Jane tells Flying Solo. “Cybercriminals know small businesses will have less resources at their disposal and be even more vulnerable.”

With the recent surge of businesses moving to online devices and systems, the scope of opportunity for cyber crime to occur has only widened. In the past financial year, one cyber attack was reported every seven minutes, up one minute on the previous year.

Cyber liability insurance has become increasingly important for small businesses, covering more than just hackers and viruses, but also the common issue of fraudulent bank account requests and instances of human error.

“That can happen to Jane the hairdresser as much as it can happen to somebody that works for a larger organisation,” says Jane.

As an example, Jane shares how an architect’s small business had their network infected with a virus received via email, which allowed the hacker access to their website. Their insurer’s breach response team were able to remove the virus and have the website reinstated. Under their cyber liability insurance policy, they recouped $5100 in costs from their insurer.

Weighing risk: could your business survive a cyber hit?

With a lot of solo or microbusiness owners putting their profits straight back into their trade, it’s important to consider whether you would be able to financially bounce back from the unexpected consequences of a cyber attack.

“Sole traders are especially vulnerable to the risks they face because they have a lot of skin in the game,” Jane says. “There is no legal distinction between the business and the business owner under a sole proprietorship, meaning that the sole trader’s private assets can be tied into liability claims.”

No matter the size of your team or customer base, your business is at risk of cyber crime if you use anything from PoS devices, to emails and online systems to manage business, according to Jane.

“Large businesses spend massive amounts of money on corporate cybersecurity to institute very sophisticated and high-tech defences,” Jane says. “For sole traders it’s often just you and you alone to deal with these problems. Without a safeguard in place, it’s your time and resources”.

While preventative measures and awareness is a no-brainer when it comes to protecting your business from fraudulent activity, sometimes falling victim to cyber tricks can be impossible to avoid. In such cases, the secret to saving your business from going under is timely and expansive damage control.

Having a strong cyber liability policy in place may cover a range of unexpected expenses, such as cyber extortion, data recovery costs, forensic investigation into the cause of a breach, and crisis management or legal costs.

“Large companies employ entire IT support teams to solve the problem and hire a crisis communication team to assist with the fallout,” Jane says. “Small and medium enterprises face most of the same threats but don’t have the means to make anywhere near the investment required to implement comprehensive protection.”

There are ways to stay one step ahead

Cybercriminals are constantly trying innovative and sophisticated ways to get access to your data and your network, and cybersecurity companies are equally looking to patch up any weaknesses. Sole traders have enough on their plate, so the last thing on anyone’s mind is damage control after a cyber attack.

“Faced with endless forms and confusing jargon, it’s easy to see why time-strapped small business owners would throw thoughts about getting cyber liability insurance in the ‘too-hard basket’,” Jane says.

If you are a sole trader, investing in cyber liability insurance means having a team of experts on hand to help manage particular situations with answers, support and solutions.

Keeping up with the current trends in business operations, BizCover uses effortless online systems to help sole traders find the perfect cover for their business. Trusted by more than 190,000 small and medium businesses across Australia, they’re the experts on every kind of cover.

With a greater amount of our business being done online, the need for reliable cyber protection is more prominent than ever before.

To find out what’s covered and to compare competitive quotes from leading insurers online, visit bizcover.com.au.

This article is brought to you by Flying Solo in partnership with BizCover.

The provision of the claims examples are for illustrative purposes only and should not be seen as an indication as to how any potential claim will be assessed or accepted. Coverage for claims on the policy will be determined by the insurer, not BizCover.

This information is general only and does not take into account your objectives, financial situation or needs. It should not be relied upon as advice. As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. © 2023 BizCover Pty Limited, all rights reserved. ABN 68 127 707 975; AFSL 501769

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