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Home » Remote Work Trend | Companies Should Purchase Cyber Insurance
September 24, 2020

Remote Work Trend | Companies Should Purchase Cyber Insurance

Computer Hacker

The rapid spread of COVID-19 has changed our world in many ways.One change is the large increase in employees working remotely, away from the company office and secured system access. Many employers and employees are finding advantages of this, but companies across the globe are seeing an increase in cyber criminals trying to access their databases and disrupt their business’ as reported by CNBC on July 29, 2020. Data breaches have increased 273% in the 1st quarter of 2020 from the prior year. This is a huge increase that should not be ignored by any business owner.

Company Network Security Risk – Working on ‘Employee Owned’ Electronic Devices

In many cases, workers are using their personal laptops and desktops to access company data from a remote site. Usually these devices are less secure than the systems provided in the work environment located within their office. Below are just a few of the problems identified using Employee Owned Electronic Devices

  • Device is lost or stolen with company data on them
  • Employee departure from company
  • Unprotected browsing
  • Use by multiple family members
  • Lack of software security updates
  • Access to unsecure Wi-Fi connections
  • Poorly trained employees

Data Breach Impact on Company Profitability and Net Worth

In 2018 Colorado passed House Bill 18-1128

  • To investigate the cause of the hack
  • Notify the impacted party and
  • Provide credit monitoring services to them
  • The average cost per record is approximately $150-$250. If a company holds personal data of individuals, they can multiply the # of customer records x this amount to get an idea of the financial impact a data breach can cause. For most companies, this kind of loss can be financially devastating or even great enough to put them out of business!
    Many companies invest heavily in research. A data breach in which this information is stolen and sold can greatly reduce the competitiveness of the breached company.
    The lost revenue due to system down time and/or customers. Ransom attacks on an organizations data are becoming more frequent. How much money would company loose if their systems were down for several days or even weeks while the tech gurus try to recreate their data systems? Or how much ransom money can a business afford to pay to get back up and running?

    Lost Company Reputation

    Wouldn’t it be fun to have to notify all your clients that their data was accessed on your companies system? How much business would be taken elsewhere if this were to occur?
    These are very important things to consider when allowing your employees to work remotely on ‘less’ secure systems than those within the office environment.

    Purchase Cyber/Data Breach Insurance Coverage to help cover these costs

    Fortunately, a company can buy ‘Cyber’ Insurance to help recover these costs. A Cyber policy can provide coverage for:

    • Response and Crisis Management /Forensics Costs
    • Ransomware Attacks/Cyber Extortion
    • Defense Costs
    • Income Replacement
    • Data Reconstruction Costs
    • Dependent Business Interruption Coverage
    • Regulatory Fines

    Many carriers also provide(at no additional cost) resources to help prevent a cyber/data breach, this service alone might be worth the cost of the insurance policy.

    The bottom line is company managers need to evaluate the risks and reward of allowing employees to work remotely and keep in the forefront the fact that their systems are less secure with employees working remote. The costs of a data breach are enormous and purchasing or increasing their Cyber Breach insurance coverage is very important during these trying times.

    Denver West Insurance brokers has licensed agents ready to answer any additional questions or quote a Cyber insurance policy for you. Give Us a Call. We are located on the west side of Denver in Golden Colorado. We serve the mountain communities , Lakewood, Arvada, Morrison, Wheat Ridge, Littleton and Westminster.

    Tags: Business insurance, commercial insurance, just good information, small business insurance

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