cyber insurance

Small Business Cybersecurity Threats and How to Stop Them

With October serving as Cybersecurity Awareness Month, and cyberattacks on the rise, it’s a good idea to understand how to secure your business’ digital information.

Many small businesses often underestimate their level of risk, since they may have fewer resources and less security than larger companies to protect them. This can leave small businesses vulnerable and may make them prime targets for cyberattacks.

Factors Contributing to Risk

  • High cost
  • Insufficient staff
  • Time constraints
  • Lack of training

The more you invest in securing your business, the less likely your business will be targeted. Taking measures to protect your business doesn’t have to be challenging. We’ve compiled several simple steps you can take to identify weaknesses and better prevent your chances of becoming a target for cybercriminals.

Small Businesses Cybersecurity Threats and How to Stop Them

A cyberattack targeting a business is an unauthorized assault to breach, destroy, disable, or control a system’s data. Cybercriminals use many different methods to launch these attacks, including malware, phishing, and ransomware, to name a few.

Human Error

Small businesses can be susceptible to cyberattacks through human error. Simple mistakes such as poor password management, or sending sensitive information to the wrong person by hitting “reply all” can be all the invitation a hacker needs to gain access to your business resulting in security breaches, data leaks, or worse.

Many employees don’t even realize how dangerous human error can be to their company. This can lead to a lack of knowledge about potential threats and how to prevent them. While some of these mistakes may not cause immediate harm, lapses in security or procedures can be disasters just waiting to happen.

Unfortunately, there are no specific answers to stop the human error from happening altogether, but there are several practices your small business can adopt to prevent these situations from arising.

Investing in basic cybersecurity training for your business’ employees can help raise awareness by identifying common threats, developing online best practices, and creating new cybersecurity policies for your business.

Utilize these protective measures to mitigate human error in the workplace:

  • Install firewalls
  • Use encryption
  • Secure your business’ network access points
  • Create an efficient and strict security policy
  • Provide continuous education for your business’ employees
  • Develop safety guidelines in the event of a data breach
  • Limit access to information – ensure only authorized employees have access to sensitive data
  • Hire wisely – conduct background checks on employees to eliminate potential internal threats

Malware 

Malicious software or malware is software designed to cause damage to a computer server. This can include viruses, trojan horses, or other destructive programs. This software allows hackers to gain access to information or control systems while depriving the business of access and compromising security and privacy.

Malware can be disguised as email attachments, ads, downloadable apps, or programs on your device that promise access to something you’ve been trying to see. In actuality, the disguised malware can give your device a virus and steal sensitive information.

Businesses need to make their employees mindful of clicking on suspicious ads by either limiting the ability to download apps without the approval of IT or management or reminding employees to only download approved programs.

Avoid malware attacks by introducing these security practices:

  • Use a secure web browser
  • Invest in security software
  • Set up web and email filters
  • Don’t download anything until it’s been verified
  • Invest in a good email service to detect scam attempts
  • Double-check email addresses from an unknown or new sender

Ransomware

Ransomware attacks are malicious software that blocks access to a computer system or threatens to publish private data until a ransom is paid.

However, cybercriminals rarely return access to your business data after the money has been paid. Paying the ransom only encourages these hackers to continue using ransomware in cyberattacks. The best thing to do is report the attack to authorities. You’ll then want to identify which computers have been affected and isolate them from the rest of your business’ network. After that, you’ll want to reboot and wipe your business’ system before restoring it.

Prevent ransomware attacks by:

  • Ensuring your business’ operating system is patched and up-to-date
  • Enlisting administrative privileges on a need-to-know basis
  • Installing antivirus to detect ransomware as soon as it arrives
  • Only installing software if you know precisely what that software is
  • Installing whitelisting software – an index of approved entities that can prevent unauthorized applications from deploying on a host

 Phishing

Phishing scams are fraudulent emails and texts made to look like they come from a reputable company in an attempt to trick companies and employees into providing scammers with sensitive data.

Cybercriminals not only use phishing to steal a company’s data, but they may also try to gain access to employees’ usernames, passwords, and bank login credentials.

These cyberattacks can be hard to detect, as many hackers impersonate trusted sources like the IRS or debt collectors to extract sensitive information.

One of the best preventive measures in fighting against phishing scams is to enable 2-factor authentication on all company accounts and purchases. This requires a login or transaction to be verified on a second device.

Avoid phishing scams with these additional tips:

  • Install antivirus software
  • Set up mobile device management
  • Back up company data in the cloud
  • Manage passwords with a password management service
  • Ensure the security of consumer and company credit card information
  • Create procedures for changing sensitive passwords when employees leave the company

Supplementary Measures

Upping security measures to prevent cyberattacks shouldn’t stop with digital processes. Make sure to invest in securing your company from every angle.

Protect your business’ payment processors

  • Install security alarms and cameras
  • Delete all ex-employee user accounts
  • Shred important documents before disposing of them
  • Collect all electronics from employees after they leave
  • Regulate access to sensitive information, admin access, keys, passwords, etc.

Additional Security Measures to Consider

Putting the above measures in place to help identify and combat cybersecurity attacks is an excellent start, but as cyber incidents become more frequent, investing in high-quality cybersecurity insurance can boost your business’ safety and peace of mind immeasurably if your small business comes under attack.

Cybersecurity Insurance

Even a minor cyberattack can weaken a small business with disastrous consequences. Investing in cybersecurity insurance can increase your business’s ability to recover.

Cybersecurity insurance protects your business from financial losses caused by incidents such as phishing, ransomware attacks, and data breaches.

Coverage from Cybersecurity insurance can be beneficial for small businesses that: 

  • Have a large customer base
  • Have high revenue and valuable assets
  • Store sensitive data online or on computers, such as:
    • Financial data
    • Phone numbers
    • Credit card numbers
    • Personal customer data
    • Social Security numbers

Cybersecurity insurance can be purchased through most insurance providers as a stand-alone policy.

Ways to Finance Cybersecurity Insurance 

While investing in cybersecurity safety and insurance is an excellent idea, it isn’t free. Depending on how expansive you’d like your business’s coverage to be, there are several financing options available to help your business cover the working capital needed to finance cybersecurity insurance, such as small business loans, lines of credit, and merchant cash advances.

  • Line of Credit

A line of credit is a flexible funding option that provides your business with access to working capital on an as-needed basis. Once your company has been approved for a set amount, your business can draw from it whenever necessary.

If your business is looking to upgrade security measures, invest in cyber-fighting technology, or require continuous cybercrime training, a small business line of credit could be the best option.

  • Merchant Cash Advance

merchant cash advance (MCA) allows small business owners access to funds in exchange for a portion of the business’s future credit card sales and other receivables. Payments for merchant cash advances are made based on credit card sales rather than having a fixed payment schedule.

If your business is considering hiring an agency or contract employees to help set up a cybersecurity protection plan, an MCA could be a good choice.

  • Small Business Term Loan

small business term loan is a flexible lending option provided by an alternative funder. With both short and longer-term lending options, term loans provide small businesses with access to working capital quickly.

If your business wants to hire an in-house IT security team – a term loan could be an excellent option.

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