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Cyber Liability: Understanding How to Prepare and Protect Yourself

March 28, 2016

Cyber LiabilityIn today’s digital world, businesses and people are interconnected in a network of computers, smartphones, tablets, and other high-tech gadgets. All of these devices are linked and continuously transferring data back and forth over the Internet, leaving them vulnerable to outside attacks. As digital technology is so new and rapidly advancing, different risks emerge every day and no one, from insurance companies to the Internal Revenue Service, is safe. And the risk isn’t isolated to just large companies; In fact, one in five small businesses fall victim to cyber crime each year and about 60% of those businesses go under within six months, according to a study by National Cyber Security Alliance. And cyber threats are only going to increase, as 2016 is expected to have the highest number of data breaches to date.

While businesses may think they’re immune to attacks because they don’t sell online, don’t collect a lot of data, use outside vendors for IT services or don’t consider themselves a target. A majority of data breaches occur because of human error and new industries become targets every day. Even if a company contracts out their IT, the company collecting data and records from clients is ultimately held responsible if a data breach occurs.

As threats continue to mount, understanding, managing and being prepared for cybersecurity risks is more important than ever. So how are businesses responding?

According to a recent Pricewaterhouse Cooper survey:

  • 91% of businesses follow a risk-based cybersecurity framework while 69% utilize cloud-based cybersecurity services
  • 59% leverage Big Data to improve cybersecurity and 65% collaborate with others to improve cybersecurity
  • 54% have a Chief Information Security Officer (CISO) or Chief Security Officer (CSO) in charge of their information security program
  • 53% provide their workplace with an employee training and awareness program
  • 52% have security baselines for third parties (which is important, since 22%  of compromise incidents were attributed to business partners in 2015)
  • 59% have cybersecurity insurance, which goes beyond general liability policies that traditionally don’t cover losses incurred over the Internet
  • 49% conduct threat assessments to ensure they’re always on top of the risk of being compromised
  • Respondents also increased their information security budgets by 24% in 2015, while their financial losses decreased 5% from 2014 to 2015

Protecting your company from cyber threats can be overwhelming.  However, whether or not you’ll be a victim at some point is not a matter of if but when, so it’s imperative that businesses begin to invest and stay educated to better defend themselves and the ecosystems around their businesses from evolving threats.  At Founders, we take the time to learn about you and your business so we can help you to identify and prepare for your specific risks.  Give us a call today!

bryan_johnson

Bryan Johnson

P&C Operations Manager

bjohnson@foundersgrp.com

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