Searching On Google For Cybersecurity Insurance Requirements?
Technology has greatly influenced and changed the way we do business today. But unfortunately, along with these changes, has come a new set of risks and liability exposures unlike any ever experienced in the business world.
Cybersecurity insurance can help protect your business and organization from the negative impact and costs of a breach, theft, or unauthorized disclosure in an electronic format of another party’s personal information. No matter how small or large your business is, it can be the victim of cybercrime or have a cyber breach.
The Cost of Poor Cybersecurity
Research shows that in 2021, the average cost of a data breach in Canada was around $6.75 million per incident. This is an increase from the $6.35 million reported in 2020 and the highest in the seven years that Canadian data has been analyzed. Additionally, the report points out that Canada’s average cost of a data breach exceeded the global average of $5.34 million.
Overall, there was a 10 percent increase in the average cost of a data breach globally, the highest in history. Data suggests that as companies were forced to adapt to continue operations during the pandemic, cybersecurity efforts may have lagged.
Remote work creates a perimeter-less environment, and the ability to defend a variety of inputs can become very challenging. Often, employees who work remotely use unsecured internet networks and computers without the types of security measures in place in a corporate workplace or environment.
Research shows that data breaches that involve remote work as a factor cost $1 million more on average. Remote work typically involves a wide range of devices and network connections, which create a cybersecurity risk. Research shows that nearly half of all breaches exposed customers’ personal information, such as names, emails, passwords, and even healthcare data. Additionally, 20 percent of these breaches resulted from compromised user credentials, such as stolen passwords.
What Are the Mandatory Cyber Breach Reporting Requirements in Canada?
As a Toronto business leader, it’s essential to stay current and be aware of the rules and regulations. Learning how the Personal Information Protection and Electronic Documents Act may apply to your day-to-day operations is one reason why you might be doing a Google search for cybersecurity insurance requirements in Ontario. Another may be that you see the reduced risks and potential benefits to keeping your customers’ digital data secure.
In essence, the Personal Information Protection and Electronic Documents Act is something that every Toronto business needs to be aware of, regardless of size or industry.
The 2018 law requires that organizations report any breach of security safeguards involving personal information under their control if it is reasonable to believe that the breach creates a real risk of significant harm to an individual. Whether the breach concerns one person or a thousand, it must be reported if an assessment indicates there is a real risk of significant harm due to the breach.
In its definition of significant harm, the law includes:
- Bodily harm
- Damage to reputation or relationships
- Loss of employment or business and professional opportunities
- identity theft
- adverse effects on the credit record
- financial loss
- and damage to or loss of property
Factors used to determine if a breach of security safeguards constitutes a real risk of significant harm include the likelihood that the data has, is, or will be misused and the sensitivity of the personal information involved. Additionally, the law requires that every organization keep and maintain records of all breaches of security safeguards involving personal information under its control, whether there is a real risk of significant harm or not.
Does My Business Need Cybersecurity Insurance?
Mandatory cyber breach reporting requirements are another risk that Toronto businesses of all sizes must manage. A security breach can put you and your customers’ data at extreme risk when it’s least expected.
Even with the best firewalls and IT practices in place, the Personal Information Protection and Electronic Documents Act is one reason that many Toronto business leaders consider cybersecurity insurance a necessary part of their commercial insurance coverage. However, whether your business operates solely online, maintains a brick-and-mortar location, or utilizes a combination of both, you can become the target of hackers.
How can Cybersecurity Insurance Help?
The majority of traditional commercial general liability insurance policies will not cover business interruption losses due to a cyber-attack event. Cybersecurity liability insurance can fill that gap. If your business is unable to perform normal business functions as a result of a cyberattack, a cybersecurity insurance policy can help pay for expenses related to the interruption, including:
- Lost income due to the cybersecurity breach
- The loss of profits that you would have earned if the attack had not occurred
- Operating expenses, such as rent and utilities that must be paid even though the business is temporarily closed
- The cost of rented or leased equipment
Cybersecurity liability insurance also helps to protect your business from:
- Data breaches, including the costs of notifying customers, some legal fees, and possibly, credit monitoring for those affected
- Damages to third-party systems, such as an infected email from your servers causing a customer or vendor’s system to crash
- Loss of data or code due to a natural disaster or malicious activity
- Cyber extortion, including ransomware, such as malicious code installed in a computer on your network that prevents you from accessing your system until a ransom is paid
The Cybersecurity Experts in the Greater Toronto Area
At Tektonic, we have provided professional IT Support for businesses in the Greater Toronto Area since 1998. We take pride in offering our clients the most advanced solutions available and providing them with cost-effective services to help keep their systems secure. Our experience has helped us develop best practices and workflow procedures around a proactive philosophy that enables you to focus on your business and not worry about your technology.
Advance prep for a cyber attack can give your business an advantage before, during, and after the attack. Our team of cybersecurity experts can help your organization meet the requirements of cybersecurity policies and provide support for cybersecurity solutions. Contact us today to learn more about how we can help give your organization an advantage and keep your data secure.
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