Cyber insurance is currently very popular with businesses. However, this type of insurance does not provide sufficient protection. Not every type of digital fraud is a cyber incident. For a cyber policy to take effect, an intrusion into IT systems must have taken place. Think of data theft, system hacking or a computer virus. This is not the case with phishing or fraud via e-mail. In that case, malicious people – although through digital channels – defraud your employees.
Unfortunately, this type of digital fraud is much more prevalent than you might imagine. The Belgian federal police recorded an increase of more than 30% in digital fraud cases last year. According to a study by Euler Hermes France, more than 7 in 10 companies were victims of at least one fraud attempt in 2019. The most common form of fraud is identity theft: supplier or customer fraud as well as CEO fraud. CEO fraud means that the fraudster poses as a high-level representative of your company (CEO, CFO, etc.) and forces your employees to make a payment or reveal sensitive information. The urgent and extremely well prepared request of fraudsters over the phone or via email often conflicts with existing security procedures.
Therefore, fraud insurance should be seriously taken into consideration to complete the insufficient cyber coverage. This is the essential way to ensure the best protection for your business. It is important that your insurance policy cover a wide range of circumstances.
A fraud insurance with adequate cover is not the only defense against digital fraud. At least as important is prevention. As a company, you can do a lot yourself to reduce the chance of fraud and to limit its consequences. Think of strict financial controls and verification processes at various levels. The use of dedicated tools to better manage your risks also works well to prevent fraud. Training your employees is such a powerful prevention tool. Bring them the necessary vigilance so that they recognize the signals of suspicious money transfers in good time.
Euler Hermes (Allianz) is one of the fraud insurers with the longest track record in Europe. We offer you the most complete insurance on the market: it covers internal and external fraud as well as certain cyber risks. We protect your assets and cover your losses caused by fraud, such as financial loss, misappropriation of property, damage to systems and reputational damage.