60% OF SMALL COMPANIES GO OUT OF BUSINESS WITHIN SIX MONTHS OF A CYBER-ATTACK.
Bob, the owner of ABC Company, logs into his remote laptop on a Sunday evening to spend some time prepping for the work week, and something’s not right. All the files on the server have been encrypted and a screen pops up demanding a ransom of $20,000 bitcoin to unlock the files. Clearly this is just a glitch, but every time he restarts his computer the same screen appears. Suddenly the fear sets in. There is a big order set to go out tomorrow and this could ruin the sale. “How do I get this fixed?” “Has any personal information been breached?” “Do I need to notify my customers?” “Who do I call?”
The threat of a cyber-attack is no longer just an anomaly, and these attacks can take many different forms. In this ransomware example, a wrong click of the mouse by an employee can give the hacker access and the ability to block you from your own data. In the scenario described, the initial concern for Bob is about conducting his business. If he is blocked out of the system, how will he complete a large deal that is pending? If he loses this deal, it could severely impact the quarterly revenue goals with this potential loss of income ($100,000). Fortunately, Bob has purchased a comprehensive cyber insurance policy and loss of income as a result of a cyber attack is covered. Bob is relieved but still has many questions and concerns.
When ABC Company purchased its cyber insurance policy, Bob was given access to an app and 24/7 access to a cyber incident hotline. Beyond the loss of income, there are numerous first-party costs associated with a cyber-attack. Once Bob puts the call into the hotline, the insurance carrier will assign a data breach coach ($15,000) and hire a forensic firm to investigate ($65,000). In this example, the forensic team determines it is best to pay the ransom ($20,000). Bob’s expense has just hit $100,000, and this doesn’t include the potential lost income if he loses his big deal.
Things continue to escalate. The forensic team has also determined that the personal information of Bob’s customers may have been compromised. Bob has over 1,000 records and has been told he needs to send notifications through the mail to each individual ($2,000). He will also be required to provide credit monitoring to each individual for a year ($50,000). The first party costs continue to skyrocket, and with a breach of personal records, there is now the threat of a third-party lawsuit.
From a business owners’ perspective, Bob’s business cannot withstand a $200,000+ loss if he does not manage the risk through a cyber insurance policy. At RogersGray, we are passionate about educating our clients on how these policies respond, what they cover, and how the hidden fees associated with a breach can add up rapidly. For any business that relies on technology, we have our clients back and ensure they’re aware of this ever-evolving risk for today’s large and small business owner.
DID YOU KNOW?
OF CYBER ATTACKS TARGET SMALL BUSINESS
THE GLOBAL AVERAGE COST OF DATA BREACH ACROSS SMBS
OF CYBERSECURITY BREACHES ARE DUE TO HUMAN ERROR
# OF MONTHS IT TAKES MOST COMPANIES TO DETECT A DATA BREACH
AMOUNT (IN TRILLIONS) EXPECTS TO BE SPENT GLOBALLY ON CYBERSECURITY BY 2021
According to Cybint, “15 Alarming Cyber Security Facts and Stats”
At RogersGray, we are passionate about educating our clients on how these policies respond, what they cover, and how the hidden fees associated with a breach can add up rapidly.
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Senior Vice President | Partner
Jeff Cotto is a Partner and Senior Vice President at RogersGray with a focus on Contractors Insurance, Condominium Insurance, Property, Non-Profit and Hospitality Insurance needs.
A frequent speaker to Condominium Trustees and Boards, Jeff was recognized as a “40 Under 40” by Cape and Plymouth Business Magazine. He has also worked with several nonprofits as a committee and board member and is currently involved with USA 500.