06 Nov

Cyber Insurance becomes a necessity

By Axis Marketing on

cyber insurance

[This article was originally published in Roofing BC magazine.]

It's hard to avoid the headlines about cybery crimes; every week brings news of another hack, online attack, or data theft. 

Yet while it may appear that cyber criminals only have eyes for financial institutions and online retailers, the truth is that digital fraudsters are active in every industry -- construction included. 


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"Every business that uses a computer system has a cyber security risk," says Grant Alsop, vice president of Construction and Real Estate with Shaw Sabey & Associates. "In the roofing industry, contractors do not typically have the potential disaster of breach of client information; however, they are susceptible to the shutdown of their computer systems from malware, which can potentially cripple a business in one hit. While systems are down, they lose business. Not only that, but now they're on the hook for the cost of getting their computer systems repaired, protected, and back up and running."

 

"The best [cyber crime] policies offer the professional services of a team to provide advice and help a company restore their systems and reduce the impact of potential lawsuits and potential damage to the reputation of a business." Grant Alsop, vice president of Construction and Real Estate with Shaw Sabey & Associates

 

Malware isn't the only risk to construction firms. Privacy breaches can threaten the integrity of client and proprietary data, and phishing or identity theft scams can ensnare employees on their own laptops and smartphones, leading to individual and corporate losses.

These risks may still be new to many in the industry, but they are real. More importantly, the fallout from a cyber event can have a very real impact on a firm's reputation and financial health. 

In view of this, a number of construction insurers have started offering cyber insurance to help mitigate financial loss due to cyber crime. These policies can vary, but are generally designed to facilitate a quick response to cyber events and cover both first party and third party costs, which range from legal expenses, forensics services, settlements and fines, and client communication efforts. 

"The best [cyber crime] policies offer the professional services of a team to provide advice and help a company restore their systems and reduce the impact of potential lawsuits and potential damage to the reputation of a business," explains Alsop, stressing, "It's important that this team has the expertise to react immediately to cyber crimes when they are discovered because the first 24 hours are crucial."

In some cases, he adds, cyber insurance coverage can be combined with other policies (e.g. crime and directors and officers liability) to augment existing protection. Either way, choosing the best type of cyber crime coverage relies on understanding a business' specific cyber risks and finding a policy -- and price -- to match.

Read the full article here

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