May 20, 2013

Cyber Liability Industry Review- Retailers

Typically, this industry segment does not pay enough attention to its cyber liability risk. Big retailers are beginning to see the impact i.e. DSW and TJ MAX, but few small businesses are really paying attention to their exposure to cyber liability.

The main reason retailers are not addressing this problem, well, simply because most do not believe they will have a problem. The common response “I am not an online company, hence no need to worry about customer information being stolen or my network being attacked.”

Fact: Though a majority of your operations may not be on-line, there are still several ways someone can either corrupt your network or steal customer information and cause major cyber liability damages. Two common claim scenarios:

A. If you have an in house computer system, a virus or malicious code can still either wipe-out your data or quickly spread infected applications to third parties and cause severe network damages. (Network damages to third parties can be covered by network security liability coverage within a cyber liability policy)

B. If you are using PCI devices (Payment Credit Card Devices) you should make sure proper PCI procedures are in place, and know that even the most capable trust-worthy employees can still make mistakes with regards to handling sensitive credit card and personal information. (Customer damages from unauthorized access to personal information can be covered by the privacy liability portion within a cyber liability policy.)

Although many small businesses feel that hackers would not target them, in reality small businesses are seen as easy prey.