Having an online shop rather than bricks and mortar has loads of great benefits. The upfront costs are much less and you can reach a way bigger customer base. You don’t need to hire anyone to man the shop or be a slave to your job 24/7.
Not to mention the convenience for customers too, being able to buy their favourite things from the comfort of their sofas.
But there are still risks. And ones that shouldn’t be taken lightly.
Cybercrime is a very real and present danger for all businesses that operate online. And 98% of businesses in the UK do in some way or other.
Online retailers, of all shapes and sizes, are a prime target for cybercriminals.
Here’s a closer look at why online retailers need cyber insurance to be at the top of their insurance shopping list…
Digital pirates. Pay up or else!
Cybercriminals know that if they can stop your website from functioning, your business will simply shut down and you won’t make money. And they’ll prey on that. They know you’ll do anything to get your business back up and running and keep your reputation intact.
If you hold personal data - that’s stuff like customer names, addresses, emails, and bank card details - hackers can hit you with a ransomware attack. They’ll threaten to delete your data unless you pay them a ransom fee. Or steal your data and use it for their own criminal gains.
And trust us, your customers won’t be best pleased if they find out their details have been taken hostage.
The worst part for you is that there’s a good chance you could lose those customers. Because trust is everything when it comes to who we shop with online.
Ransomware attacks are rapidly on the rise in the UK, and roughly one in five attacks are aimed at online retailers. So you need to be on your toes.
Don’t get phished off
Another reason online retailers are at risk is the fact that they’re often part of a bigger supply chain. This opens up a whole new world of opportunity for a cybercriminal.
If you’re on a public Wi-Fi network, you’re more vulnerable to hackers who can easily infiltrate your emails. Then they’ll be able to see all your supplier contact details.
Be wary too of how much private information you share on social media. Cybercrims will scour your accounts to work out possible passwords or answers to security questions and get to your emails that way.
They can then disguise themselves as a supplier you know and trust. A convincing invoice comes your way – and boom. They’ve got you… and the hard-earned cash they’ve persuaded you to pay into a bogus bank account. And that’s just one of the simpler social engineering stunts they can pull.
You might think you’d notice a fraudulent phishing email of this type, but those cybercriminals are pretty smart and always evolving. Even the best of us can be fooled.
What does cyber insurance for online retailers do?
Get brought down by a cyber-attack and you’ll have more than one glitch to fix.
Firstly, you’ll have to try and repair the holes in your security. While you’re doing that, you might have to halt business – no customers, no money rolling in. Then there’s trying to retrieve any lost data, which could be held at ransom. Also, you might have to tell your customers or suppliers the bad news, and then deal with the fallout…
And so it goes on. Easy to see how these situations spiral out of control and end up costing a bomb to rectify. You only need to look at the news headlines to see what a huge financial impact cybercrime has on the industry. The likes of Tesco, JD Sports, WH Smith, and plenty of other retail giants (as well as plenty more smaller ones) have fallen victim.
That’s where cyber insurance comes in.
In the event of a claim, you’ll have access to IT experts. They’ll save your back-end, plus make sure your systems are secure and that customers can use your site safely.
You’ll also have access to legal experts if things get sticky with the regulator or you’re sued for losing people’s personal data. Plus a PR expert to handle a reputation crisis. Some policies will also help you recoup any financial losses due to lost custom or website downtime.
How to be cyber-aware
Think of it as a game of cat and mouse.
It’s all very well having cyber insurance as a backup. But it’s even more important that you have all the necessary cyber security in place to try and outsmart cybercriminals.
Stay up to date with the cyber world and the constantly evolving threats that could affect your business. There are some helpful tips in the National Cyber Security Centre’s Small Business Guide.
Some cyber insurance policies will include cyber security training for you and your staff, which is arguably the best protection for your business and makes the policy worth every penny.
Finding the right cyber insurance for online retailers
When you buy cyber insurance, do your research and study the policy carefully. There are plenty of cheaper deals out there. But be warned – you get what you pay for. You want to make sure you’re covered for ransomware, social engineering attacks, and business interruption losses.
And don’t forget there are other types of insurance you might need to consider. Take a look at our online retailers' insurance for more info.
Click on the link to find out more about cyber insurance, or call the team on 0345 222 5391.
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