Manufacturing Companies Need Cyber Insurance
Nearly every company relies on digital technology. That means nearly every company is facing the danger of unwanted individuals and entities messing around in your company’s digital data.
To begin, the digital security of an organization can only be as strong as the basic judgment of its employees. It only takes a single click by a single employee to open an “innocent” link that turns out to be malware – bad software that can lock up a computer server in seconds.
This is also called a “ransom” virus. Once a manufacturer’s system is compromised, a hacker then contacts the manufacturer, asking for a “ransom” that can range from several thousand dollars to millions to decrypt and return files. “Ransom” software has grown to become the most prevalent attack used against every industry. Worse, some types of this virus are free for hackers to download and use.
Should you endure a cyber attack, the costs pile up quickly. You’ll need to hire a forensic investigator ($250-$500/hour!) to determine the scope of the attack and if any sensitive data (such as employee records or confidential corporate information was breached. If data has been exposed, you’ll need to hire a law firm to notify each individual and regulatory body per the laws of the state.
Manufacturers rely on their computer systems to properly fill and ship orders. Damage to a manufacturer’s computer system could be devastating and lead to defective products or a complete halt in production. The forensic investigator will figure out what went wrong, but it will take a skilled team to eradicate the malware and repair the system.
Furthermore, manufacturers will experience a direct financial loss every hour that their systems are down. They will incur unexpected additional costs such as sourcing products by alternative means and paying staff overtime to meet deadlines. Additionally, manufacturers of non-durable goods could see an exponential loss in profit if inventory spoils during the system outage.
“Cyber Crime” is one of the most frequent claims in cyber insurance to date. Cyber criminals trick financially responsible employees of a manufacturer to send money to a fraudulent bank account. Hackers have become patient and will often sit in the system undetected, monitoring and intercepting email activity before executing their scam. Their tactics range from posing as the CEO, a vendor, or client to simply creating fake employee profiles in the payroll system to siphon money out.
Are you prepared for the costs to your business if you endure a cyber attack? A quick conversation will show you how Van Beurden Insurance can help.
Content provided by Evolve MGA
