As artificial intelligence (AI) revolutionizes industries worldwide, it’s not just legitimate businesses reaping the benefits—cybercriminals are exploiting this cutting-edge technology too. A growing number of small business owners are now alarmed by how AI is enhancing the sophistication of cyberattacks. In fact, a recent survey conducted by the Insurance Bureau of Canada (IBC) reveals that 65% of small and medium-sized businesses in Canada are worried that advancements in AI and new technologies could make defending against cyber threats even more challenging.

“AI has made cyber-attacks easier to automate and harder to detect and can pose a real threat to the integrity and security of any business,” said Mahan Azimi, Manager, Catastrophic Risk Policy, IBC. “With AI applications and new technology becoming more numerous and widely used by cyber criminals, there is a growing need for business owners to improve their cyber resilience.”

AI-powered tools, such as ChatGPT, are enabling hackers to create more convincing phishing emails, which heightens the risk of social engineering attacks. Furthermore, emerging technologies are evolving to outpace cybersecurity defenses, making it even harder for businesses to stay protected in real time.

Despite these increasing threats, small business owners appear to be scaling back their efforts to bolster their cyber defenses. The survey highlighted a concerning trend: in 2023, 69% of respondents reported taking steps to mitigate cyber risks, but by 2024, that figure had dropped to 61%.

The survey results also uncovered several alarming statistics:

  • Nearly 45% of business owners believe their company could be at risk of a cyberattack or data breach, yet 62% still don’t view cybersecurity as a top financial priority.
  • Only 45% of businesses have implemented any form of cybersecurity defense, and just 31% have enhanced their cybersecurity protocols in the past year.
  • A mere 18% of respondents reported having insurance coverage in the event of a cyberattack.

“As cyber criminals are quick to leverage AI and other new technologies, business owners need to stay one step ahead to safeguard their businesses, employees and their customers,” added Azimi. “It doesn’t need to be expensive or onerous. IBC has several free resources to help business owners better understand cyber risk and the steps business owners can take to improve their resilience. Becoming familiar with cyber insurance is also a crucial tool in managing your cyber risk.”

IBC is actively supporting business owners in understanding and improving their cybersecurity measures through its annual Cyber Savvy public education campaign. As part of this initiative, IBC has introduced a 10-question self-assessment tool designed for small business owners considering cyber insurance. This assessment guides business owners through the essential cybersecurity protocols that insurers typically evaluate when determining risk.

For business owners looking to boost their cyber resilience, resources and tools are available at CyberSavvyCanada.ca.