Cyber Liability

cyber liability

Like no other time in history, businesses of every size are facing serious risks to their operations. The data that organizations need to collect simply to do business is under constant attack. Consumers expect that their data is kept secure from unwanted data exposure, but the likelihood of a data breach event occurring means it’s only a matter of time before a business becomes a victim. The consequences of unauthorized access to sensitive data stored, collected or managed by a business can have a crippling effect.

A privacy breach is a security incident in which sensitive, protected or confidential data is intentionally or unintentionally released, lost or exposed. This data may include personal identity information, such as social security numbers, credit card or bank details.

If your sensitive business data is lost or released, you may have to spend significant time and money resolving the situation and restoring your reputation and your credibility.

Now, we need to do more than just preserving our physical assets and business continuity. It means having coverage that responds to two of the fastest growing threats: consumer identity theft and commercial data breach exposures.

Most businesses think a privacy breach won’t happen to them but a privacy breach takes place every two seconds in Canada. It’s important to note that large organizations aren’t the only victims of privacy breaches; in fact 30% of all reported breaches involved companies with fewer than 100 employees. The impact on the company after a breach can be extremely serious.

– 51% of businesses report that they were impacted by service downtime.
– 42% lost productivity.
– 74% report a loss of customers.
– 59% faced litigation.
– 33% faced fines.
– 32% experienced a decline in share value.
– 13.8% lost income.

As we said before, the effects of data breaches are far reaching and can be extremely detrimental to a company of any size.

You’re probably wondering how a privacy breach happens:

There are many, many ways in which a breach can take place. Some examples are:

– A fax number is misdialed
– Computer glitches.
– Hackers or thieves.
– Lost or stolen laptops.
– Unauthorized access to computer system.
– Improper document disposal.
– Improper office equipment recycling.
– Private documents forgotten on the printer.
– Client lists deleted or sent to the wrong address, among many others.

Our insurers partner with cyber risk consultants like IDT911 provide value and add services like education, proactive protection, and incident remediation. They also offer coverages for first and third-party losses.

We believe that every business should have a cyber endorsement to be fully protected in the event of a privacy breach.

Information Technology

technology insurance

Did your last broker think that Mobile Developer meant you drove around to construction sites? Insurance is complex enough without having to play broken telephone.

John McClelland is our broker specializing in tech and has first hand experience as a Web Designer and Developer, Web Hosting, Open Source CRM implementation and as a Network Administrator. He understands your business. John is well equipped to learn about what you do and the risk’s you face.

We can offer coverage for:

  • Commercial General Liability (CGL)
  • Errors and Omissions (E&O)
  • Wrongful Act
  • Privacy Breach
  • Media Liability
  • Cyber Breach

Whether you’re doing software, hardware, programming, coding, app development, or one of the countless other specializations in the information technology sphere, miBroker can help you get the coverage you need.

EMAIL JOHN

Business Cyber Risks and Tips for Risk Management

There’s a saying that goes ‘fail to prepare and prepare to fail’. This is extremely true for cyber risks. Do you have a website? Networked computers connected to the internet? Do you store private client information? If the answer to any of these questions is yes, then you need cyber liability insurance.

Young companies and startups often feel immune to cyber risk and are tempted to opt-out of the coverage to save on premium. Startups actually have the most to gain from proper cyber liability coverage. The harm to reputation from having client data compromised can be fatal if not managed properly. Further, startups and other small businesses may be considered soft targets and at greater risk than larger corporations.

Here are five potential cyber risks facing small businesses now:

Ransomware
This is where a piece of malicious software, generally received via a phishing email, encrypts all of the data on the company’s network, then the perpetrators request a ransom in order to provide the decryption key. Often these ransom amounts are below $2,500 but the costs to remedy the situation as an alternative to paying the ransom would be far more. Just recently Penneco Oil Co. Inc.’s computers were infected which enabled the conspirators to hack the company’s bank accounts for $3.5 million.

Hack Attack
This is when a hacker manages to gain access to a company’s network. Hackers often accomplish this by exploiting an unpatched vulnerability within the software. This allows them to gain access to company data. Often the target of the hackers is personally information of customers, especially credit card information. NASA was once hacked by a 16 year old Jonathan James NASA officials valued the documents stolen by James at around $1.7 million. The incident forced NASA to shut down its computer systems for three weeks and cost them about $41,000 to fix.

Denial of Service Attack
These attacks as becoming increasingly cheap and easy to carry out for attackers. A denial of service attack is done simply by overwhelming a company’s website through pushing a large volume of data to its servers in a malicious manner. One known example is the wave of attacks that targeted Yahoo and Amazon in 2000, which was estimated to have a cost over $1.2 billion in damages.

Human Error
Humans can often be the weakest link in your company’s cyber risk management. A vast number of data breaches are the result of information being lost, or distributed to the wrong person, this is easy to do for e.g. an email typo. Even the seemingly mundane can have far reaching consequences, particularly where sensitive personal information is involved.

Fraud
This is where a criminal poses as a senior person within the firm – either by hacking into or ‘spoofing’ their email account. Spoofing is when a hacker poses as someone else and ‘tricks’ the user into thinking they are, generally, someone with authority. They then convince a worker with financial authority to make a rush payment. The worker makes the payment and it is an automatic loss. Deloitte recently published a press release explaining to clients that these frauds have increased tremendously and warned them to be vigilant.

Small businesses can help reduce their exposure to cyber risks by:
• Using secure passwords: TIP: make passwords stronger by using three random words, numbers and symbols.
• Installing antivirus and malware software on all company devices.
• Regular software updates: software updates contain vital security upgrades which help protect you from the latest malware and hackers.
• Educate staff on the dangers of cyber risks, and what to be aware of, particularly where unusual emails or requests are received.

 

References:

Metro News
Radware
CSO Online
Deloitte