Karen McDonald, associate director of professional risks at Accountancy Insurance, told AccountantsDaily that while PI insurance is a legislated necessity, cyber insurance is often viewed as a “nice to have, not a need to have”.
“Many accountants believe that when it comes to a cyber breach, ‘it’s just not going to happen to me’,” said Ms McDonald.
“Accountants, along with the rest of the global community, have no choice but to be involved in the digital space in some capacity or another.”
According to Ms McDonald, many PI insurance products in the market only contain what is referred to as a ‘cyber extension’, which provides coverage of up to $100,000 in the wake of a cyber breach.
“An almost negligible amount when you are potentially faced with the real, significantly higher cost,” she noted.
Ms McDonald said firms must be aware of the hefty fines associated with a breach of the Australian Privacy Principles, and to consider the downtime that can affect their business as a result of a cyber breach.
As well as offering some peace of mind in the midst of a cyber attack, cyber insurance can almost be deemed an attractive selling point for the business itself, she said.
“Utilising a cyber insurance policy is also a good marketing tool for attracting prospective customers, portraying your firm as prepared and protected even in the undesirable event that a breach occurs,” she said.