Nationwide Agency Forward survey showed 40 percent of small business owners expect a cyber attack to cost less than $1,000, and another 60 percent think it would take less than three months to fully recover.
However, Nationwide claims data shows cyber claims range between $15,000 to $25,000 in recovery costs, plus costs associated with the restoration process, reputational damage and a potential legal fallout The average recovery time for a business after an attack is 279 days.
“Small business owner concern around cyber attacks has risen 15 percent since the beginning of the pandemic, but most owners still don’t realize the extent of damage a cyber attack could have on their company and livelihood,” said Peter McMurtrie, president of Commercial Lines at Nationwide. “Agents have strong opportunities to bust some of these common misconceptions around effects post-cyber attack and emphasize that there is greater risk than just loss of funds—business reputation is at stake.”
According to survey results, 48 percent of small business owners feel ready to prevent a cyber attack on their business. Just 56 percent of small business owners report offering cybersecurity training at least once a year, and less than 25 percent of small business owners send regular phishing test emails to employees.
The survey from Nationwide found 70 percent of commercial lines agents said clients are concerned about a cyber attack but less than half regularly discuss cybersecurity with their customers—a concerning statistic, especially for small business owners, since many of them greatly underestimate the costs and recovery time associated with a cyber attack.
Lack of knowledge related to the availability of cyber insurance could be behind the survey’s finding that only 28 percent of small business owners report having cyber insurance compared to 71 percent of middle market business owners.
Although small businesses were found less likely to have cyber coverage, Nationwide said the survey found that they overwhelmingly responded that they’re interested in learning more about what a cyber insurance policy has to offer. When made aware of cyber protection resources and products, about 75 percent of small business owners say they’re interested in purchasing common coverages.