Chubb Survey: More Than Half of SMEs in Asia Pacific Are Unprepared to Manage Cyber Risks
• Less than half (48%) of SMEs have spent time improving their cyber risk management
• 40% of SMEs have never had cyber risk insurance
• 68% of SMEs have experienced a cyber incident in the past 12 months
SINGAPORE, 17 October 2019 — A survey by Chubb of Small and Medium Enterprises (SMEs) across Australia, Hong Kong SAR, Malaysia and Singapore has found they remain unprepared to manage cyber risk, with a disconnect between perceived and actual risk.
The annual Chubb SME Cyber Preparedness Report 2019 –‘Ignorance is Risk’
released today, shows 81% of SMEs are confident they are prepared to face attacks by cyber criminals. However, more than half (55%) say they are unaware of all the cyber threats they face. The SMEs polled for this report had between 2 to 249 employees.
Additionally, less than half (48%) of SMEs have spent time improving their cyber risk management, with only 46% having any form of data breach response plan.
Highlighting the gravity of the issue, the report shows that 68% of SMEs experienced a cyber incident in the past 12 months. Australia was the least affected, with 49% of respondents suffering an incident. This rose to 65% in Singapore and 76% in Hong Kong. Malaysia was most affected, with 84% of businesses experiencing a cyber incident in the past year.
“We see a dangerous level of apathy around cyber risk among SMEs. On the one hand, an increasing number of SMEs are experiencing cyber incidents, yet on the other unpreparedness and inaction persist,” said Andrew Taylor, Cyber Underwriting Manager, Chubb Asia Pacific.
Employees Your Best Cyber Defence
Close to a quarter (23%) of SME leaders identified employees as the biggest weakness in their cyber defence, with human error a factor in 36% of incidents.
Among the concerns, half (48%) of leaders are not confident that their employees with access to sensitive data are fully aware of their data privacy responsibilities.
Unsurprisingly as a result, better training on cyber risks is a priority for more than half (54%) of SMEs.
“Instead of companies viewing their employees as a cyber threat, they should view them as an opportunity to improve their cyber defence. Employees who are trained to identify and manage cyber risks can help protect a business from the front line, and also address an issue early before it snowballs,” said Mr. Taylor.
He continued, “Phishing scams, where employees click on malicious email links, played a part in over a quarter of cyber incidents faced by SMEs in the past year. This is one example of an incident that can be easily mitigated through better training and awareness.”
The Customer Comes Last
SMEs across all four markets performed poorly across a variety of indicators in their cyber incident response:
- Fewer than half (48%) of SMEs notified affected parties following a data breach.
- Less than two out of five (38%) reviewed their processes and protection and following, that took no further action.
- 14% took no further action beyond recovering their files following an incident.
As well as performing poorly in cyber incident response, the majority of SMEs remain uninsured for cyber risk. Across the region, a significant 40% of SMEs have never had cyber risk insurance and 16% have let previous cover lapse. 7% of respondents do not know if they had cover or not, which was skewed higher by 14% of SMEs in Australia.
“This should ring the alarm bells for SMEs,” says Mr Taylor. “The potential fall-out for SMEs from a large cyber incident could be catastrophic. With SMEs making up the vast majority of the business community, it is vital that more is done to protect small businesses and their customers from cyber risk. Raising the level of cyber insurance is a start but this also needs to be supported by better training and enhanced regulation.”
About the Chubb SME Cyber Preparedness Report 2019 - ‘Ignorance is Risk’
This year’s report, ‘Ignorance is Risk’, has been produced by Chubb. It is based on a survey of 1,400 respondents from Small and Medium Enterprises (SMEs) in four locations; 300 each from Singapore and Hong Kong, and 400 each from Australia and Malaysia. Respondents comprised board-level executives (82%) and senior managers or directors below board level (18%) from SMEs between 2 to 249 employees. The industries respondents belonged to are: Manufacturing (20%), Professional Services (19%), Retail & Hospitality (13%), Technology (8%), Education (7%), Financial Services (5%), Healthcare (4%), Media & Communications (4%); and other industries (20%).
Chubb is the world’s largest publicly traded property and casualty insurance company. With operations in 54 countries and territories, Chubb provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients. As an underwriting company, we assess, assume and manage risk with insight and discipline. We service and pay our claims fairly and promptly. The company is also defined by its extensive product and service offerings, broad distribution capabilities, exceptional financial strength and local operations globally. Parent company Chubb Limited is listed on the New York Stock Exchange (NYSE: CB) and is a component of the S&P 500 index. Chubb maintains executive offices in Zurich, New York, London, Paris and other locations, and employs more than 30,000 people worldwide.
Chubb’s franchise in Asia Pacific comprises an extensive network of operations serving Australia, China, Hong Kong SAR, Indonesia, Korea, Macau SAR, Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand and Vietnam.
Additional information can be found at: chubb.com.
For further information: Michele Anne Minjoot
T: +65 6398 8708
T: +65 9618 5119