Businesses urged to prepare for increasing threat of cyber attacks. Local companies are 'woefully underprepared' and need to protect themselves says the Insurance Council

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The insurance industry warns that New Zealand businesses need to better prepare for escalating cyber threats.

Insurers are urging New Zealand businesses, particularly small and medium-sized enterprises, to review the security of their networks and internet operations and consider any gaps in their insurance cover.

Internationally there have been high profile technology breaches with the recent cyber-attack on eBay and the hacking of US retail giant Target last year that compromised the personal data of millions of shoppers.

“The hacking of NIWA’s supercomputer last week is a stark reminder that New Zealand is not immune to the increasing global threat of cyber-crime,” says ICNZ Tim Grafton.

“Cyber-related crimes are believed to have cost New Zealand businesses over $625 million in 2011 and that’s probably a conservative figure because some businesses are reluctant to disclose a cyber-breach of their systems,” says Mr Grafton.

Global cyber-attacks increased more than 2,000 percent in the past four years with about half originating from the Asia Pacific region and an estimated 75 percent of organisations in this region experiencing a cyber-attack over the past two years.

“Experts are warning that New Zealand is woefully underprepared for the increasing threat of cyber-attacks,” says Mr Grafton.

The insurance industry welcomes Government moves to step up efforts to address the potential risk of cyber-attacks but warned that New Zealand businesses could do more to mitigate against potential risks.

“The insurance industry offers cyber risk insurance protection for internet and network exposures that can cover a range of matters including liability, intellectual property infringement, malicious code and viruses, business interruption, unauthorised access, theft, web site defacement and cyber extortion,” says Mr Grafton.

“So it’s important that New Zealand businesses review their cyber security risks, fully understand the complexities of the very real risks they face and consider appropriate insurance to safeguard their operations and reputation,” says Mr Grafton.