Cyber Insurance

June 19, 2019 | by

Cyber insurance is becoming a prominent coverage in recent years and its effects can be debilitating from an operations standpoint when a cyber event takes place. There are two main areas I will highlight that have been affecting agriculture related risks ransom ware and social engineering. According to Travelers, since 2015 it is estimated that 55% of business’s have been affected by a cyber related incident.

Ransomware: a type of malicious software, or malware, designed to deny access to a computer system or data until a ransom is paid.

This can bring your entire operation to a halt by seizing control of your operating ability through your computer systems which can put serious strain on operations; from parlors, grain complex’s, to not being able to access anything on your computer systems. Often times people ask how is this possible? Unfortunately, it’s relatively simple. Typically, a generic email is sent asking for assistance from another person within the organization, the ransomware is embedded within the email once a response is sent back to the originator of the email the ransomware is activated and your computer system is shut down. That’s when a written demand for money will appear and will hold your system ransom until it’s paid. This is becoming a very common occurrence and is costly from not only from a monetary standpoint but an operating standpoint as today so much is done through the use of computer systems.

Social Engineering: a scheme that intentionally misleads an employee into sending money or diverting a payment based on fraudulent information that is provided to the employee in a written or verbal communication such as an email, fax, letter or even a phone call.

The easiest way to think about this type of cyber fraud is to think invoices…. how many invoices are received and sent on a day to day basis by your business? Many times that answer is in the hundreds or thousands over the course of a year, this type of threat is done by the attacker over the course of a period of time, they research behind the scenes who has the authority to pay invoices, what limit they’re approved up to, who approves them, and when invoices are typically paid. They use this information to falsify an invoice, the email typically comes in almost identical to that of one of your vendors except; one letter or digit could be altered in the email address, or the address on the actual invoice could be slightly altered. These are typically large sums of money and once that money is sent via check or transfer that money is gone typically in an overseas account.

Minimize your exposure.

  1. Know your data, and create back up for files, data, and bandwidth capabilities.
  2. Train your employees to recognize irregularities or suspicious emails.
  3. Ensure systems have appropriate firewall and antivirus technology.
  4. Have an action plan in place.
  5. Review cyber insurance coverage’s annually at a minimum.

How I can help.

The one thing we always hear is “this could never happen to me”, I’ve been in this industry for over 7 years and I’m here to tell you that it’s not a matter of if, it’s a matter of when these types of cyber attacks will take place. They’re frustrating, debilitating, and takes a lot of valuable time away from your business. The good news is, there are insurance products in place that can resolve these matters in short order, get you whole from a financial standpoint, but most importantly getting your business back up and running in a timely fashion. Please contact me at chad.flentje@avidrisk.com or 608 827-4525 for more information and will leave some tips on how to prevent these cyber-attacks from taking place.

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