Cyber criminals frequently target smaller companies, not just the large corporations that make headlines. Attackers often see fewer security resources as an easier way in. In a 2024 Business Development Bank of Canada survey, 73% of small businesses reported experiencing a cybersecurity incident. Knowing the biggest cybersecurity risks for small business owners in Canada, and the simple steps that reduce them, helps protect your data, your customers, and your income. Cyber insurance can also support your recovery if an attack gets through.
Key takeaways
- Small businesses are attractive targets because they often have fewer security resources than large companies
- Most incidents trace back to human error, weak passwords, and unpatched software
- Layered defences and cyber insurance help limit financial loss and speed up recovery
Why small businesses are attractive targets
Cyber criminals look for the easiest way in, and smaller companies often have thinner defences than large companies with dedicated security teams. That puts many small businesses at risk of an attack.
Here's why cyber criminals target smaller companies:
- They hold valuable customer data, payment information, and other sensitive data
- Most businesses this size don't have full-time IT or security staff
- Limited budgets can mean older software and gaps in protection
- One weak vendor can open a door, since cloud services and outside suppliers are now part of daily business operations
For small business owners and decision makers, size offers no protection. Limited resources can leave a company at high risk, making it an easier target for cyber criminals than a larger organization.
Common cyber threats facing small businesses
Understanding the cyber threat landscape helps you put your effort where it counts. Most cyber attacks on smaller companies come from a handful of familiar methods, but cybercrime tactics keep evolving.
Phishing scams
Phishing scams trick staff into revealing sensitive information or clicking a malicious link. The message often mimics a trusted source, such as a bank, supplier, or manager. These online threats work because they rely on human error, not just technology.
Ransomware and malicious software
Ransomware locks your files and demands payment, often in hard-to-trace digital currency, to restore access. It usually arrives through malicious software, infected attachments, or computer viruses. An attack can freeze your organization's systems and cause costly business interruption.
Weak or stolen passwords
Reused and simple passwords give attackers an easy entry point. Stolen credentials let them pose as legitimate users and reach accounts across your organization's systems. A single shared password can expose confidential information and private information in minutes.
Unpatched software and security vulnerabilities
Hackers exploit known security vulnerabilities when software and your operating system aren't updated. Skipping updates leaves loopholes open long after a fix exists. This is one of the most common, and most avoidable, cyber risks.
Third-party and AI risks
Your risk doesn’t stop at your own network. Vendors, contractors, and cloud services that handle your data can expose you if their security is weak. A survey conducted by the Insurance Bureau of Canada points to third-party risk as a growing concern, since a vendor breach could leave you liable for exposed customer data. New tools add another concern, since staff using unapproved AI apps may share private information without meaning to. Set an acceptable-use policy that restricts unapproved AI tools for work data, and steer staff toward approved tools with proper data controls.
How to reduce your cybersecurity risks
You don't need an enterprise budget to lower your risk. A few practical habits address the most common cybersecurity risks for small business owners and protect against the cyber events that hit smaller companies most often. Build these into your own business routines and train your team to follow them.
Turn on multi-factor authentication
Multi-factor authentication adds a second check, such as a code sent to a phone, on top of a password. Even if a password is stolen, this extra step blocks most unauthorized access. Switch on multi-factor authentication for email, banking, and any account holding sensitive information.
Use strong passwords and a password manager
Give every account a unique, complex password, and store them in a reliable password manager so no one has to memorize them. This closes off one of the easiest routes for attackers. Avoid sharing logins across staff.
Install and update anti-virus software
Reputable anti-virus software catches many computer viruses and blocks known malicious software before it spreads. Keep in mind that free versions of anti-virus tools may offer limited protection for a business. Update the software, your apps, and your operating system as soon as patches are released.
Limit employee access
Give each person only the access they need to do their job, a practice known as least privilege. Restricting employee access and administrative privileges limits the damage if one account is compromised. Control physical access to devices and servers too, and remove access promptly when someone leaves.
Train employees to spot threats
Since so many incidents start with a click, teach your team to recognize phishing scams and report anything suspicious. Regular, plain-language training helps staff avoid human error and question requests that ask for money or confidential information. Employees in professional services and other data-heavy fields especially benefit from refreshers.
Back up data and plan for incident response
Regular backups let you restore files after a ransomware attack without paying a demand. Pair backups with a written incident response plan so everyone knows their role during a breach. A clear plan shortens downtime and reduces confusion when it matters most.
How cyber insurance can help
Even strong defences cannot stop every attack, and recovery can be expensive. Cyber insurance is coverage designed to help a business respond to and recover from a cybersecurity incident. Depending on the policy, it can help with costs tied to data breaches, business interruption, notifying affected customers, and legal liability if their sensitive data is exposed.
For context, a 2025 Insurance Bureau of Canada survey found that just 22% of Canadian small and medium businesses carry cyber insurance, and only 47% say they are prepared for an attack. That gap leaves many owners exposed to a financial loss their standard business policy may not cover.
At Aviva Canada, we offer Aviva Cyber Insurance for Business, comprehensive coverage that helps small and medium businesses respond to and recover from a cybersecurity incident, with access to a 24/7 incident response line. To find the right fit for your company, talk to your insurance representative about your options.
Protecting your business from cybercrime
Cyber risk is part of running a business today, but it is manageable. Strong passwords, multi-factor authentication, updated software, careful employee access, staff training, and reliable backups take you a long way. For more Canadian guidance, the federal Get Cyber Safe program offers a free small business guide.
To learn how the right coverage can support your recovery, contact an insurance representative to explore cyber insurance for your business.
