Remote Employees Expose Need for Cyber Liability Insurance

This year, after COVID-19 was declared a pandemic, 88% of business organizations all over the world mandated or encouraged all their employees to work from home, according to a global survey conducted by Gartner, Inc.

While the pandemic has certainly influenced a recent increase in remote work, telecommuting has become increasingly popular regardless. In the United States, remote work has risen by 173% between 2005 and 2018. 

For companies who have allowed and even encouraged working from home, many have seen benefits both for the employers and employees. A majority of remote workers state that their productivity increases when working from home, as well as experiencing less work-related stress. Additionally, U.S. companies that allow remote working have a 25% lower employee turnover rate, according to Owl Labs.

Of course, there are negative sides to working remotely as well. Full-time telecommuters often report a decrease in effective communication, and some even loneliness. But for businesses, the risks can be greater.

54% of IT professionals think that remote workers are a greater security risk—and they are not wrong.

The past year has seen a surge in cyber events affecting businesses of all sizes. With the growing volume and sophistication of online threats like viruses, ransomware, and phishing scams, it is important to know the proper practices to stay safe online. 

What are the Cyber Liability Risks?

Virtually all businesses use information technology in some way, and while IT is great for enhancing your business operations, it is important to understand the risks that come with technology. Lost, stolen, or compromised data can expose your business to these expenses:

• Regulatory Fines: Businesses are required by state and federal regulations to protect consumer’s data. If a data breach occurs because your company did not meet compliance requirements, you could get some hefty fines.
• System Recovery: Having to repair or replace your computer systems can for you to shut down operation, resulting in additional loses.
• Liability: As is with any type of breach, you could be liable for costs incurred by customers after a cyber-attack.
• Notification Costs: Depending on your state, you might be required to let customers know if a breach occurred. If you have a lot of customers, the cost can quickly add up.
• Class Action Lawsuits: A large-scale data breach can cost you thousands, if not millions in lawsuits.

How Can Employers Help Keep Their Business Safe Online?

It starts with educating your employees. Here are some helpful tips on what to discuss with telecommuters, as well as a good reminder for all employees regardless.

1. Enhance your login security. Do not reuse passwords and create passwords that are more complex. Think short sentences rather than words, to add complexity and length while making it easier to remember. It may also be smart to use a password manager to store, secure, and generate strong passwords. If possible, turn on multi-factor authentication.
2. Secure your devices. Use anti-virus software and block pop-up ads. Enable a lock screen and encrypt your device in case it gets stolen. Also, look into a DNS like Quad9 that can detect and automatically block websites with malware.
3. Train on phishing and social engineering hacks. Employees should be suspicious of links in emails and express caution before clicking. Be wary of quick wins or incredible deals that seem too good to be true. Double-check businesses with consumer watchdogs like the Better Business Bureau. And never enter credit card information on a site without HTTPS (as HTTP sites are not secure).
4. Encrypt and back up local data on your computer to secure a ransomware threat. There are many cloud-based systems available and affordable.
5. Keep software updated to patch vulnerabilities. Updating will often fix bugs and keep your system optimized. Never use cracked, pirated, or unlicensed versions of software or an OS, as they commonly contain malware.

What Does Cyber Liability Insurance Cover?

Depending on your Business Owners Policy (BOP), certain types of cyber incidents could be covered. However, in this digital age, it is best to get a stand-alone cyber liability policy to extend coverage. This policy can cover risks such as:

• Identity theft
• Reputation recovery
• Business interruption
• Cyber extortion
• Loss or corruption of data

Protect Your Business Today with Cyber Liability Insurance

Cyber-attacks are an increasing threat to businesses of all sizes. All it takes is one mistake. Stay covered and protected with Cyber Liability Insurance.

For more information about cyber risk and insurance, contact Chastain Otis Insurance Agency today. We can find a custom plan that fits your needs.