Why familiar cyber security gaps still create expensive incidents
TechRound’s recent focus on common cyber security gaps is timely because the weaknesses that hurt small and medium-sized businesses are rarely obscure technical flaws. They are usually ordinary operational oversights: shared passwords, unpatched software, excessive user access, weak email controls, untested backups and staff who have not been given a realistic way to identify fraud.
For a UK SME, this matters beyond the immediate disruption of an attack. A cyber incident can stop orders being processed, prevent staff from accessing cloud systems, expose customer information and trigger contractual questions from suppliers or clients. If personal data is involved, the business may also need to assess whether the breach is reportable to the Information Commissioner’s Office (ICO). The cost is not simply the ransom or IT repair bill; it includes downtime, forensic investigation, customer communications, legal advice and lost management time.
The important lesson is that cyber security is not a once-a-year IT task. It is a business continuity discipline. The controls that appear basic are often the same controls that reduce the likelihood and severity of a claim under cyber insurance.
The gaps are not isolated IT issues
A useful way to read the TechRound article is as a warning against treating each gap separately. In practice, attackers combine small weaknesses.
For example, a finance employee may receive a convincing Microsoft 365 login page by email. If multi-factor authentication (MFA) is absent, a stolen password may be enough to enter the mailbox. From there, the criminal can search invoices, impersonate a director, reset passwords for other services and send payment-diversion emails to suppliers. If that account has administrator privileges, the situation escalates further.
Likewise, an unpatched remote-access device may provide entry, but poor network segmentation, broad permissions and inaccessible backups are what turn access into a major ransomware event. The vulnerability begins the incident; weak resilience determines how far it spreads.
The commercial impact of “getting by”
Small firms often rely on a handful of people who understand the systems, suppliers and customer processes. That efficiency can become a vulnerability. If one director controls all software subscriptions, payment approvals and recovery emails, the business may have no quick route back into its systems if their account is compromised or they are unavailable.
A practical cyber security programme should therefore be designed around essential business services:
- How would the company take payments if email or accounting software failed?
- Which customer data would cause the greatest harm if exposed?
- Who can authorise a bank-detail change?
- Can systems be restored without paying an attacker?
- Does the business know who to call during the first hour of an incident?
These questions turn abstract security controls into decisions a business owner can make.
The controls cyber insurers increasingly expect
Cyber insurance can provide meaningful support after an incident, including access to breach-response specialists, legal advisers, forensic investigators, notification support and cover for certain financial losses, depending on the policy wording. It is not, however, a substitute for prevention.
When obtaining or renewing cyber cover, insurers commonly ask about the controls most associated with avoidable losses. Answers should be accurate: an incorrectly completed proposal can create serious coverage difficulties. While requirements vary by insurer, SMEs should expect scrutiny of the following areas.
Multi-factor authentication everywhere it matters
MFA should protect email, cloud storage, remote access, administrator accounts and any system that holds sensitive information or enables payments. Email is particularly critical because it is commonly used to reset access to other platforms.
SMS codes are better than password-only access, but app-based authenticators or hardware security keys are generally stronger options. Crucially, MFA needs to be enforced, not merely offered. Check that legacy email protocols and service accounts cannot bypass it.
Patch management with ownership and deadlines
“Automatic updates are on” is not a complete patching strategy. SMEs need an inventory of laptops, servers, firewalls, routers, cloud applications and line-of-business software. Someone must be responsible for acting on critical security updates and for replacing products that are no longer supported.
This is especially relevant for remote-working equipment. An office router, VPN appliance or unmanaged home computer may not receive the same attention as a central server, yet it can become the easiest way into the network.
Backups that can actually be restored
A backup is valuable only if it is separate from the compromised environment and restoration has been tested. If ransomware encrypts live systems and connected backup drives, a business may discover too late that it has no usable recovery point.
Use a documented backup approach that includes offline, immutable or otherwise protected copies where appropriate. Test recovery regularly, beginning with the systems needed to trade: customer records, accounts, orders, production files and email. Record how long restoration takes. A backup that takes ten days to restore may not meet the commercial need of a business that must resume operations within 24 hours.
Access based on role, not convenience
Staff should have only the access needed for their job. Review administrator accounts, former employees, shared logins and third-party supplier access. Shared accounts are particularly problematic because they make it difficult to determine who took an action and impossible to remove access cleanly when someone leaves.
For payment systems, introduce separation of duties. The person entering bank details should not be the sole person approving payment. A verbal call-back to a known phone number for any change to supplier bank details remains a simple and effective defence against business email compromise.
What UK SMEs should do in the next 30 days
The most useful response is not to buy every available security product. It is to establish a proportionate baseline and prove that it works.
Week one: identify your critical exposure
Create a short list of all systems used to hold customer data, send email, process payments and run operations. Include outsourced providers. Identify who has administrator access, whether MFA is enforced and where backups are kept.
At the same time, check the UK National Cyber Security Centre’s Cyber Action Plan or Small Business Guide for practical baseline guidance. A specialist managed service provider can help, but the business owner should retain visibility of the risks and responsibilities.
Week two: close the easiest high-impact holes
Enforce MFA on email and remote access. Remove dormant accounts. Apply outstanding critical patches. Disable or replace unsupported systems where feasible. Change passwords that are shared, default, reused or known to have been exposed.
Also establish a payment-verification rule in writing. No invoice or banking change should be actioned solely from an email request, even where it appears to come from a trusted director or supplier.
Week three: test people and recovery
Run a short phishing simulation or send staff examples of the warning signs: urgency, unusual payment requests, QR-code login prompts, changed bank details and unexpected file-sharing links. The objective should be reporting, not blame. Give employees one obvious route for raising concerns quickly.
Then restore a sample of data from backup. Measure whether the restoration is complete and usable. This is often the point at which hidden gaps in backup permissions, storage capacity or documentation emerge.
Week four: align insurance with real risk
Read the cyber insurance proposal and policy schedule alongside your updated controls. Check the ransomware, business-interruption, social-engineering, data-restoration and incident-response provisions. Social engineering and funds-transfer fraud are not always covered in the same way as a network breach, so assumptions can be costly.
Ask the broker or insurer what notification requirements apply. Many policies require the insured to contact the insurer’s incident-response line before appointing forensic firms, lawyers or public-relations advisers. Keep that number away from the company email system, such as in a printed incident plan and on directors’ phones.
Cyber insurance should support resilience, not replace it
The temptation after reading about cyber threats is to seek a policy as a quick solution. Insurance is valuable, but it cannot restore customer confidence automatically, reverse a public disclosure or remove the operational pressure created by a week without systems.
The stronger approach is to use insurance as one layer of a broader resilience plan. Technical controls reduce attack opportunities; training reduces human error; tested recovery reduces downtime; and insurance provides specialist support and financial protection when those safeguards are not enough.
For UK SMEs, the immediate priority is not perfection. It is evidence of sensible control: MFA is active, accounts are controlled, updates are managed, backups restore, payment changes are verified and staff know what to do. Those measures address the ordinary gaps that criminals exploit most often and put the business in a far stronger position before a cyber insurance application or a real incident.
FAQ
Does a UK SME need cyber insurance if it uses Microsoft 365 and cloud backups?
Yes, cloud services reduce some infrastructure burdens but do not eliminate risks such as phishing, account takeover, payment fraud, misconfiguration or third-party disruption. Cyber insurance may help with response costs and interruption losses, subject to the policy terms, but it should sit alongside MFA, access controls and tested backups.
Is multi-factor authentication enough to prevent phishing?
No. MFA significantly reduces the risk from stolen passwords, but attackers can still use phishing to steal session cookies, trick users into approving prompts or redirect payments. Combine MFA with staff reporting procedures, conditional access settings, email filtering and payment verification.
What should an SME do first after suspecting a cyber attack?
Disconnect affected devices or accounts where safe to do so, preserve evidence, contact your IT or incident-response provider and notify your cyber insurer through the policy’s specified route. Do not delete evidence, communicate with an attacker or make a payment decision before obtaining specialist advice. Consider legal advice promptly where personal data may be involved.
Will poor cyber security invalidate a cyber insurance claim?
It depends on the policy wording, the proposal answers and the circumstances. Insurers may impose specific security requirements or conditions, and inaccurate information can affect cover. The safest course is to answer all underwriting questions truthfully, document controls and tell the insurer or broker if a material answer changes.
Source: TechRound — Tue, 13 Oct 2026 11:02:37 GMT
