Taking Small Steps Forward in 2023 – Weathering the Storm – with or without Insurance

The insurance sector has faced a series of costly upsets…and insurers are tightening their belts.

The intent here is not to wail and whine. It is to present simple and clear ideas on how leaders of small businesses can take “small steps forward in 2023”. Small steps to improve their businesses through small actions and yield tangible results that compound over time.

With no desire to dwell on insurance dilemmas that create challenges for managing small business risks, it is important to understand the costly trends that have caused insurance companies to make radical changes to their policies.

As examples:

  • Increased weather catastrophes, perhaps due to global climate change,
  • Increased cyber breaches, exacerbated by the COVID pandemic, and
  • Increased human resource requirements, including DEI (diversity, equity, and inclusion).

Leaders of governments and large enterprise businesses have teams of staff, capable of dealing with all these issues…and many more.

Leaders of small businesses must do the best they can with limited resources.

The Rapid Evolution of Cyber Security Insurance

Four years ago, insurers were knocking down doors, touting the need for cyber security insurance… offering deals.

Two years ago, Harvard Business Review explained some of the problems.

Now, cyber insurers are refusing to serve small businesses. If they do provide cyber security insurance, it is essential to check the fine print with very keen and technically skilled eyes. That is essential if leaders of small businesses want to make an intelligent guess about whether or not a cyber-breach claim will be paid by the insurer.

That sounds cynical.

Yes – the cynicism has grown over the last 4 years as the insurance sector has broadened and deepened the sets of rules is requires its clients to satisfy to qualify for and receive coverage of cyber risks.

Taking small cyber security steps forward in 2023

Three “small steps”:

  1. January 2023 – Understand your current cyber risks and what you are doing to mitigate those risks,
  2. If you want cyber security insurance coverage, plan at least 3 months ahead…do not back into a renewal or a new policy (you will need time to understand the devils in the details embedded in applications and policy wording), and
  3. If you intend to “self-insure”, establish policies and practices during Q1 2023.

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