Five Reasons why Insurance Agencies Need Cyber Insurance
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1. Wire Transfer Fraud “Social Engineering”
Modern day hackers are looking to trick CFO’s, CEO’s, and even insurance agency clients into wiring money into fraudulent bank accounts. These attacks usually originate through phishing emails or stolen login credentials. What is the average wire transfer of your agency?
2. Ransomware
As an insurance agency, you rely on computers to operate as a business. Ransomeware is malware intended to lock up an agency’s data and hold it for ransom. As a result, an insurance agency can experience high forensic costs to restore data and business interruption.
3. Reputational Harm
An insurance agent’s failure to protect their client’s confidential information will not only lead to a loss of current clients, it can lead to loss of future clients. A smart insurance agency has adequate reputational harm cover in the event of a security breach.
4. Personal Funds Protection
Evolve’s policy provides protection for the personal bank accounts of Senior Executive Officers, in the event money is wired out of their personal bank accounts in the office. Hackers are increasingly targeting businesses and stealing SEO’s credentials, resulting in compromised bank accounts.
5. Management Liability
D&O insurance does not adequately contemplate coverage for a cyber triggered management liability claim. Evolve’s cyber policy will protect Senor Executive Officers in the event a hacking attack has a lasting impact upon an insurance agency, leading to a cyber triggered management liability claim.
Actual Insurance Agency Claim:
In early 2017, an insurance agency with 40 people fell victim to a ransomware attack that cost roughly $25,000 in less than 48 hrs. It all started on Friday afternoon, when a commercial lines account manager accidentally clicked on an invoice in an email that appeared to be from a client. This account manager did not realize that email was a phishing email from a hacker and the invoice was a ransomware virus. The office ended its work day, while the ransomware virus began wreaking havoc, encrypting files on the insurance agency’s internal servers, as well as a portion of its back up servers. Luckily, the insurance agency’s IT provider flagged the unusual system activity on Saturday morning, notified the agency owner, and began working to decrypt the affected files. The insurance agency owner reported the cyber claim to Evolve and forensic experts were immediately brought in to work with the agency’s IT provider. Within 48 hours, the ransomware virus had completely been removed and all of their files had been decrypted. The $25,000 cost to the insurance agency was a result of combined hourly billables between the IT department & the policy forensic experts. Important: If the professional forensic experts had not been brought in, the agency most likely would have lost all of their data, which would have resulted in much larger costs; like data breach attorney hourly billables, PR firm hourly billables, business interruption lost profit, reputational harm lost profit, and data reconstruction hourly billables.
IIAV member agencies now have access to one of the leading cyber insurance “specialist” markets, Evolve MGA. With member exclusive rates and a 1-page application to bind, don’t delay in protecting your agency against a cyber-attack.
For Additional information and an application, visit www.iiav.com or call 804-747-9300 / 800-2884428 to speak with any of our insurance representatives below:
Linda Loving - LLoving@iiav.com
Melanie Miller - mmiller@iiav.com
Bonnie Warren - bwarren@iiav.com
