Common Types of Cybercrimes and How to Protect Your Business From ThemInsurance Explained
The history of cybercrime is already a very rich one, with experts citing initial instances of cyberattacks as far back as the 1970s. As the world we live in becomes more and more reliant on computer systems and the internet, the number and types of cybercrimes, as well as their severity, increases.
According to recent cybersecurity statistics, cybercrime will cost companies worldwide an estimated $6 trillion by 2021. As a broad definition, any illegal activity that involves a digital device or a computer network can be considered a cybercrime. Most people associate the term with hacking activities and threats of viruses, but the broader definition also includes activities such as bullying and harassment via the internet.
While cyberattacks can affect individuals as well, the cybersecurity industry tends to focus on the protection of businesses from cybercrime, since cybercriminals are, naturally, attracted to targets through which they can incur the most damage possible, both structurally and financially.
Many assume that only technology companies are threatened by cybercrime; businesses operating in industries such as software development or eCommerce. But in reality, there are no businesses today that are entirely safe from cybercriminals.
Despite the fact that most countries have an array of laws prohibiting just about every possible type of cybercrime, attacks continue to grow every year and no law or regulation can guarantee that you and your business will not end up on the radar of a cybercriminal. And to understand how to protect yourself and your business from cyberattacks, it is crucial to first identify the most common types of cybercrimes and understand how these attacks can do serious damage to your business in a variety of ways.
It’s also important to remember that these types of cybercrimes and methods of committing cybercrimes that we will discuss very regularly overlap and can be used in unison in order to achieve the cybercriminal’s goals.
Social Engineering and Phishing
Social engineering and phishing attacks are some of the toughest cybercrimes to combat simply because these attacks rely more on human error than on cybersecurity protocol and technology. A recent study shows that close to 83% of companies reported that they experienced phishing attacks in 2018.
A social engineering attack results from a cybercriminal making direct contact with a person, whether it’s through an email, on the phone, or even in person. For example, a cybercriminal could offer you a USB or CD and instruct you to install a virus that is found on the item.
In most phishing attacks, cybercriminals will pretend they are legitimate contacts and try to convince you to give them access to confidential information such as passwords or credit card numbers. The most well-known phishing attack is the now-infamous “Nigerian Prince” attack which, believe it or not, still manages to scam people out of serious amounts of money today, despite its presence in pop culture and widespread proliferation.
Most phishing and social engineering attacks that people encounter will be much more subtle and believable. For example, phishers might send out emails to company employees using the name of the business’s CEO and ask them to click on a link or download something. Many might immediately do so, without even checking to see if the email is coming from a legitimate company email address.
While social engineering and phishing attacks try to trick you into providing sensitive information that cybercriminals can then use to do damage to your business, hackers are not as polite. Most of the time when the term “hacking” is mentioned, there is no trickery involved. Rather, hackers directly attack your computer or your networks to extract what they need and reak havoc on your system.
Hacking attacks can compromise the integrity of any digital device, from smartphones to computers, to entire networks. Technically, hacking does not necessarily have to involve illegal activities, but over the years, the word has become synonymous with malicious attacks on digital devices and costly data breaches. Some hackers attack for financial gain, some hack in a sign of protest or disagreement. There are even some hackers who just do it for the sport of it and see hacking into a protected digital device as an exhilarating challenge.
The bottom line is that if a security weakness on your computer system or digital device has been exploited and people who should not have access to these systems gain access, you have been hacked in some way or form.
One of the most popular hacks that cybercriminals employ is a distributed denial of service (DDoS). In such an attack, which can be extremely expensive and damaging, your network is flooded with traffic in an effort to overwhelm it so that the people who are supposed to have access to the network (your employees, for example) are unable to use it. In these attacks, hackers will commonly ask for payment or some other type of reimbursement in order to restore your service to its prior state.
Malware attacks are constantly on the rise and according to expert reports, might be the most common type of cyberattack, simply because they come in so many forms. Every type of malware is designed to affect your devices and systems in different ways, which is why they are so dangerous. For example, a popular type of malware is spyware, which can literally spy on you and even see your keystrokes in order to gain access to passwords, or remotely control your computer and steal documents and information from it.
Similar to DDoS attacks, ransomware is a type of malware that will hijack your network and lock it down, asking you to pay a ransom for its release. If you are running a business that deals with confidential data that often needs to be used in a timely manner, such as an accounting or law firm, you are a perfect potential target for ransomware attacks because your client information and its availability are incredibly important to the work that you do.
While initially created to help computers connect and coordinate, botnets are often used by cybercriminals to spread malware as well. Botnets were initially designed to help networks of computers perform repetitive tasks that are needed to keep a website or any other system performing. However, they can also be used to spread malicious coding and malware throughout your system if hijacked.
These basic examples of malware only scratch the surface of the various types of cybercrimes that are present and the formats of malware are continuing to multiply and transform as security experts find ways to recognize and stop them.
How to Protect Your Business From Cybercrimes
When talking about securing businesses and implementing strategies to protect them from cyberattacks, one of the greatest myths that exists is that cybercriminals only target large corporations. In fact, statistics show that 43% of cyberattacks are aimed at small businesses.
No matter what industry you are in, your business cannot be entirely safe from cybercrimes. Here are some of the preventive measures that your business can take in order to decrease the chances of a cyberattack causing widespread chaos.
Educate Your Employees
The best way to defend yourself from cybercrimes is through knowledge, and the earlier you educate your employees about the risks related to cyberattacks, the better off your entire company will be.
As we’ve already discussed, many of the most dangerous cybercrimes rely entirely on human error, which is why it’s important for your employees to know what to do, and more importantly, what not to do. Make sure that they are aware of the threats of social engineering and phishing attacks and that they know not to open attachments or download files that are delivered to them through questionable sources.
Teach your employees about the importance of maintaining strong passwords and make sure that they avoid creating passwords that are easy to crack (their birthdates or the birthdates of their children, for example).
Make sure that a section of your onboarding program is dedicated to cyber safety and create training programs and initiatives that will raise awareness about the threat of cyberattacks and what employees can do to protect themselves and the company.
Hire Security Experts
If you’re running a SaaS company or any other type of tech company that relies 100% on the internet to thrive, then you should probably have a team of cybersecurity experts working in-house at all times. But if you don’t have the same types of needs or you simply don’t have the budget for that just yet, you should at least outsource experts to help you protect your computer systems and networks.
A good cybersecurity team should be able to not only perform cybersecurity assessments and install protective measures to keep your business safe, they should also provide you with the ability to monitor your systems and networks and provide consultations and regular checkups on your security program.
Two security measures that every expert team should be able to easily install for you are firewalls and encryption. Firewalls will be able to both protect your network from hackers trying to get into your system and stop your employees from visiting websites and accessing things that could compromise your company.
Full-disk encryption should be able to protect all your business networks and devices from would-be hackers, as long as the encryption passwords are kept secure and you are following protocol installed by your security experts.
Remember to do your research before hiring and make sure that you are hiring a trusted team that has good references and a proven track record of providing excellent cybersecurity services for numerous clients.
Assess Partner Risks
Your networks and employees aren’t the only paths through which cybercriminals can attack you. If you are working with any third-party partners that have access to your systems in any way, it’s important to make sure that they are secure as well and doing everything they need to in order to protect themselves and their entire ecosystem of partners.
Before you sign any types of contracts with third-parties, make sure that you thoroughly investigate their cybersecurity situation to make sure that it is up to standards. Ideally, you could have your security team or your outsourced experts come up with a checklist that sets cybersecurity standards for would-be partners. Another thing that your company should do in order to protect itself from possible problems related to a partner’s inability to curb cyberattacks would be to ask them for a certificate of insurance to make sure that they are covered for potential losses they (and you) could possibly incur as a result of cybercrime.
Insure Your Business
Of course, you should be protecting your business as well with the right insurance products. Insurance is one of the best investments that you can make when it comes to protecting yourself from cybercrime because the right coverage can make it much easier for you to deal with and recover from a cyberattack.
A recent report warns that nearly 60% of small and medium businesses that have been hacked will close up shop just six months after the cyberattack. While this study did not give any data regarding how many of those businesses were properly insured to combat cybercrime, it’s fair to assume that the answer is “not many.”
Obviously, the most important insurance product you’ll need is a cyber insurance policy. In the case of a cyberattack, a good cyber policy will be able to cover costs related to data loss, recovery and recreation, business interruption, notifying all parties affected by the attack, potential civil damages, and hiring computer forensics teams to identify the source of the attack.
Serious cyberattacks can cripple a small business financially, which is why small and medium-sized businesses need to have an insurance program that protects them from these threats even more than large corporations need similar protection.
Along with cyber liability insurance, it would also be a good idea to purchase an errors & omissions (professional liability) policy as well. This insurance product can protect your business from civil lawsuits for negligence, common mistakes, and more. Since data breaches and cyberattacks are often linked with human error, it’s not uncommon to see clients take businesses to court over damages that were a direct result of cyberattacks.
Create a Proper Response Plan
The most important aspect of putting together a plan for protecting your company from cyberattacks is realizing that there’s a good chance that you are going to be the victim of a cybercrime sooner or later, no matter what you do.
That’s why it’s also incredibly important to know what you need to do if one should occur. Consult your cyber experts and all relevant stakeholders in order to put together a proper response plan that your company can implement if a cyberattack occurs. Not only does having a plan help you to recover from the attack more quickly, but it also shows your clients, investors, and partners that you take the threat of cyberattacks seriously.
A good response plan needs to include a complete strategy so that every person in the organization knows what they need to do in the event of a serious cyberattack; which employees need to take what steps, what the business leaders will need to communicate, how the company will engage stakeholders, clients, and the public (if necessary) when a cybercrime occurs, and so on.
What trends can we expect to see in 2021 as the landscape of the insurance brokerage industry continues to rapidly evolve?