When you think of hacking and cybercrime, you’d be forgiven if the first thing springing to mind were a large corporation being taken down by a mysterious ‘Cyber Jedi’ – syphoning off countless thousands into a Swiss bank account. After all, big stories like the recent cyber-attack on Talk Talk make better headlines. So hearing that the modestly sized Yorkshire tearoom, Bettys, has recently been a victim of hacking may come as something of a surprise.

The company recently admitted that it was hit by a data breach that affected their database of 120,000 customers. Through a weakness in their security software, hackers were able to illegally access customer data including names, email addresses and encrypted passwords. Although no financial data was lost – which was wisely stored securely and separately with a certified third party – the concern for customers was that the hacker could now try other websites using the same credentials and gain access to other online accounts. Many people use the same details on several services. Read more on the importance of creating super secure passwords here…

What’s the true cost of cybercrime?

While on the face of it, losing 120,000 email addresses might seem trivial in the grand scheme of things, the reality couldn’t be further from the truth. When you start to crunch the numbers, the true costs can be shocking. Here are some example figures to help you size things up.

• Up to £360 per hour – the cost of legal advice and guidance
• Up to £260 per hour – for forensic experts to uncover the root cause
• Up to £90 per hour – to pay for expert crisis management
• Up to £1.80 per letter – to notify customers about the breach (the worst case scenario for Bettys could cost up to £216,000)
• Up to £5 per call – to contact customers where you don’t have their address (for Bettys this could cost up to £1,050,000)
• Up to £50 per person – to track each customer’s credit and check against fraud (for Bettys this could cost up to £10,500,000)
• Up to £240 per case – to resolve any established cases of identity theft

Cybercrime is a reality for businesses large and small.

It’s clear that it’s not just large corporates and global enterprises that have to deal with cybercrime. Businesses of all sizes need to give some attention to the cyber risk they face. The reality is that no business is too small to be hacked. Here are some more statistics from the Federation of Small Business for you to consider:

• Cybercrime costs the UK Economy £27bn per year with 80% of this hitting businesses
• On average businesses lost £3,926 through fraud and data loss
• 2/3 of recorded cases occurred at companies with 11 to 100 employees
• 70% of small firms that experience a major data loss go out of business within a year
• 80% of companies that do not recover from a disaster within one month go out of business

It’s not just hackers

With all this information, it’s easy to think that the only risk you face is from hackers. In reality, human error and the resulting public exposure can be just as destructive.

Fortunately, Cyber Liability Insurance ensures you’re not just covered for incidents caused by external forces. Your customers, your data, and even your reputation which is arguably the most valuable thing to your company, is also covered for a range of internal as well as external eventualities.

Make no mistake though, whatever the cause of the breach or incident, it could cost your company a significant amount of money.

Print PDF