How to Protect Your Small Business Against Cybersecurity Risks

Cybersecurity threats don’t just exist for large corporations. Many small and medium-sized businesses also experience data breaches, hacking, and other cyberattacks. Since they're often less prepared than larger corporations, small businesses tend to experience significant and expensive downtime after an attack. 

Further, when a small business experiences a security breach, it may not be able to bounce back as quickly as a larger organization. With smaller, leaner budgets, small businesses often don’t have the resources to pour into a quick recovery.

Fortunately, a local independent insurance agent can help you protect your small business against digital threats with the right cyber liability insurance. They'll help you equip your company with a policy tailored to its unique niche and operations. But first, here's a guide to protecting your small business from common cyber threats.

Cyber Security Stats for Small Businesses

Perhaps contrary to popular belief, small businesses are often targeted by hackers and other cybercriminals. Here are some recent stats demonstrating common cyber risks for small businesses.

Awareness of your small business's cyberattack vulnerabilities is the first step to getting your company the protection it needs against vicious and costly incidents. An independent insurance agent can also assist you with getting the proper cyber liability insurance coverage to reimburse your small business in case of a cyberattack.

Why Hackers Target Small Businesses

Small businesses may not have the robust protection that many larger corporations have, making them an attractive target for hackers. Instead of risking exposure while going up against deep in-house cybersecurity teams or well-funded security operation centers (SOCs), hackers may hone in on smaller businesses, knowing many don’t have the resources a comprehensive defense requires.

Additionally, small businesses, despite only having a handful of employees, often have large storehouses of sensitive information, particularly customers’ financial data which may include the following.

Further, small businesses often keep databases of personally identifiable information (PII) of both members of their company and clients and customers, such as the following.

• Full names and addresses
• Phone numbers
• Email addresses
• Usernames and passwords for email accounts
• Login credentials for internal applications and networks

If a hacker can penetrate a small business’s network, they can collect a bevy of information they could use for fraud or sell to other malicious actors.

The Biggest Cybersecurity Threats for Small Businesses

While there are many different tools and tactics hackers use to breach small businesses, some are more commonly used than others. Some of the top threats small businesses should be on the lookout for include social engineering, phishing, viruses, and malware.

Social Engineering

Social engineering refers to when a hacker tries to manipulate someone into revealing sensitive information by pretending to be a person or organization that the target can trust. Attackers often use the following scare tactics.

• Pretexting: This is when an attacker makes the target feel compelled to reveal sensitive information. They may pretend to be a law enforcement official, an auditor, a security company, or an employee from a social network trying to help the victim “secure” their account.
• Baiting: Baiting involves the hacker trying to lure their target by using a free giveaway or unbelievable deal.
• Quid pro quo: In Latin, quid pro quo means “something for something.” In a quid pro quo attack, the hacker may pretend to be someone from an IT department and say, “I have a solution for your problem. I just need your login information to move forward.”

Unfortunately, many users fall victim to social engineering scams. Being aware of the tactics hackers commonly use against the public can help you avoid falling victim to these attacks. 

Phishing

Phishing is when an attacker sends an email pretending to be someone else. In some cases, phishing is used as a form of social engineering. In a phishing attack, the malicious actor may try to get the victim to click on a link with malware or go to a fake site and enter login credentials for a portal within the organization’s network or a financial account.

Malware

Malware is a general term that encompasses several types of attacks. Common examples of malware include the following.

• Viruses: These spread from one computer to another. Hackers may use a small business to spread viruses into the network of a larger business with which they do business.
• Ransomware: This involves an attacker taking control of computers and demanding payment before returning control to the business.
• Worms: These are viruses that self-replicate on one system while spreading copies of themselves to other computers.

Knowing the most common types of malware and how to protect against them can help keep your small business safe from these costly cyber threats. 

Password Hacking

Password theft is one of the most common cyber threats against small businesses. That's why it's so important to choose strong passwords for all of your company's accounts and use different passwords for each login. 

A hacker can use a high-speed program to test your company's passwords to gain access to private data. These criminals have much greater success when weaker passwords are used, such as those containing common words or things that may be easy to guess, such as pets' names and the user's birthday. 

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How to Protect Your Small Business from Cybersecurity Threats

Luckily, there’s a lot you can do to protect your small business from cyber threats, including backing up data, encrypting important information, using a firewall, and buying business insurance. Follow these simple steps to protect your small business from many common cyber threats.

1. Back up Your Data

Your small business should perform routine data backups to keep your information safe in case of a data breach or accidental erasure. With a data backup, you can recover from even the most catastrophic attacks within hours or even minutes. To protect your business, backups should be:

• Performed regularly
• Focused on the most business-critical systems
• Saved to hard drives and cloud storage

Having hard disk copies of your small business's data and copies in cloud storage can help dramatically increase your chances of not only keeping your records safe but also being able to recover them in case of an incident. Cloud storage helps guarantee you can recover your business's data even in the event of a completely destructive fire, which could impact your computer systems and hard drives. 

2. Encrypt Important Information

Encryption makes it impossible for anyone without the decryption key to read information. The process involves scrambling the data into an unreadable code. The data only unscrambles when an authorized user accesses it. As a result, encrypting sensitive information protects it even if an attacker is able to steal it.

3. Use a Firewall

Using a firewall filters out data coming into your Wi-Fi network that may contain threats. Next-generation firewalls can also use machine learning to identify zero-day threats, which are those that haven’t yet been identified and profiled.

4. Train Your Employees on Safe Cyber Practices

Your employees should receive initial training in cybersecurity practices upon starting their positions. These trainings should also occur regularly as your small business expands its safety measures. 

Your small business may choose to enforce employee penalties if they violate cybersecurity policies to increase the chances of these guidelines being followed. Train your employees on how to keep company data and customer information private and safe.

5. Buy Cyber Liability Insurance

With a custom-designed cyber liability insurance policy, you can protect your business from the impacts of a data breach or cyber-attack. Your business can get reimbursed for related expenses if hackers successfully steal the following information.

• Customer and employee private information
• Addresses and phone numbers
• Credit card numbers
• Social Security numbers
• Account numbers
• Health records
• Driver’s license numbers

You also get financial support for these necessary steps:

• Informing customers about a breach
• Recovering data
• Defending your small business in the event of a related lawsuit
• Hiring professionals to fix your computers and network components
• Restoring customers’ personal identities

If customer or employee data is stolen by a hacker, your small business could be sued for resulting financial losses and other harm. That's why having the right cyber liability insurance is critical.

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An Independent Insurance Agent Can Help You Protect Your Small Business

Despite the prevalence of cyber threats to small businesses, you can get ahead of the danger by taking the steps above and having the right business insurance policy that includes cyber liability coverage. A local independent insurance agent can help you equip your business with all the cyber liability insurance it needs to protect against the most common cyber risks. 

They can shop and compare policies and premiums for you and present you with multiple quotes. And down the road, your agent will still be there to help you file business insurance claims and update your policy as necessary.