Friday, March 26, 2021

With Cyber Crime Rampant What Does a Supply Chain Business Need to Do to Get Insurance?

Cover Hangs on Ensuring Companies Have Taken Appropriate Steps to Protect Themselves
Shipping News Feature

UK – WORLDWIDE – One of the facts that emerged during a year like no other is that business priorities, ways of working and fears have all moved centre stage. Whilst it is understandable that the concerns of CEO's across industries put previously unrated pandemics and health crises at the top of their worry list when asked, we are concerned here with the silver medal position, cyber threats.

The assessment comes from the PWC 24th Annual CEO Survey in which last year cyber concerns only merited fourth place, behind over regulation, trade conflicts and uncertain economic growth. In the twelve months since, the fear of cyber-crime has jumped 14%. Chris Gaines, cyber security leader at PwC UK, commented:

“As the criticality of technology has increased over the past year, so have UK CEOs fears of cyber security threats. This heightened concern is understandable as the stakes are so much higher than they were 12 months ago. Businesses have become far more aware of how reliant on technology they are for their very survival. As such, the risk of cyber security attacks naturally weighs more heavily on their minds.

“The technological changes implemented over the past 12 months have not only been across businesses, but also society. Many of them were implemented in haste. Risk averse organisations who, in different times, may have taken years to plan for increased remote working simply made the change overnight. Organisations must now effectively and securely embed such changes while continuing to evolve and innovate.”

The logistics sector, and indeed the entire supply chain, has been made aware of the dangers, particularly through some of the best documented cases. Whilst we ourselves have publicised those who publicly fought the criminals, there are always others who have found it preferable to keep heads down and pay the ransom.

So the important question is then, what can a company do to protect itself from the growing and ever present threat as more sophisticated techniques to rob or damage data blossom? The threats also normally come from territories beyond the reach of those attacked or the law enforcement agencies which supposedly protect them from other criminal acts.

As ever in the world of shipping the average company will turn to its insurers to mitigate the threat, but how effective is the cover purchased and does paying more mean better protection. We asked Pamela McCarthy, a specialist in cyber insurance cover at Peter Lole Insurance who said:

”There are now a wide range of policies giving a variety of options of new cover, but there is no simple comparison and it needs a dedicated cyber specialist to take one through the possible policies available from end to end.

”Cost of cover can vary widely with a variety of specified risks, data breach and theft, cyber extortions, social engineering claims etc. Problems include business interruption costs and damage to computer equipment, all of which need to be assessed individually.

”What is certain is that, for most cyber insurers, proactive risk management including employee training is not now just necessary to keep insurance premium costs down as without a data management and security policy including regular staff training many insurers will not provide cover. The weak link so often in the data chain being those who have access to communications from outside the business.”

To see just how seriously this subject has affected the logistics industry simply type the word Cyber into the News Search Box at the top of the page.