by Josh Fifield, Account Executive at Clark Insurance
With all the positive energy and robust investment in Maine’s real estate markets, there is reason to be optimistic if not jubilant about your prospects for success as a developer, vendor or lender, etc. That’s all above the surface of the cyber world where black hat crackers, master hackers, firewall bombers, phishing engineers, and war-driving sleuths are plotting your demise or already are picking your pockets. Their work has made headlines, forced Presidents of Fortune 500 companies to resign, and helped compromise hundreds of millions of records. Your success is their opportunity.
We’re talking about cyber liability and cyber crime. Gratefully, they are often not successful but, like a flood or fire, it can devastate your business and most importantly your reputation.
In researching statistics for this article, one web site (sourced through a normal Google search) attempted to install malware on our computers – in less than a minute. Our new software defenses thwarted the attempt.
What are the top line risks as you project your bottom line? These are facts according to NetDiligence.com:
- The median cost per record to comply with notification regulations for a lost, identifiable data record is $13 but with an average cost of $964. Imagine discovering that you’ve lost 1,000 records. Without the right cyber liability coverage, you and your company are exposed to $13,000 to $964,000 of money straight off your bottom line.
- The median claim for cyber liability is $76,984 and the average cyber liability claim is $673,767
- Thirty-two percent of data breaches had insider involvement (NetDiligence.com)
Let’s focus again on what needs to be revealed to be considered identifiable information:
A name PLUS one of the following
- Email address
- Financial information
- Social Security number
- Driver’s license
- Medical record
If you possess any of this data (e.g. rental agreements, tenant information, copies of checks, deposit records, emails, etc.), you need to have strong loss control measures and procedures in place AND you need to be properly insured.
The cost centers of a cyber claim are notification compliance for each state from which a record originated, forensic investigation to determine the extent of a loss or breach, crisis management services to communicate to all who care about your breach, credit monitoring and legal services.
The other category to be mindful of is Cyber crime and Cyber deception where you experience an actual loss of money, intellectual property or other proprietary information. Cyber deception also known as “social engineering” is when someone pretending to be you via dishonest misrepresentation, directs another within your organization to pay funds to third party under false pretenses.
To remain successful, it is in our best self-interest and the interest of others (tenants, partners, investors and employees) to help protect and defend them against cyber attacks and identity fraud.