The Magnitude of Cyber Security even on Prince Edward Island

The Magnitude of Cyber Security even on Prince Edward Island

| February 01, 2021
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With COVID-19, companies have invested even more into technology solutions and with the sudden
increase of our highly digital world comes an even larger exposure to Cyber Crime. The importance of
cyber security should become a priority for all businesses. Cyber Liability claims have started to easily
reach astronomical numbers and very few businesses on PEI have the proper coverage in place for a
Cyber event.

When you think about your valuable assets, there are probably a few things you think of, right after
employees, I think data comes to mind. Data is not covered on a regular property & liability insurance
policy, it is intangible. So how many businesses are operating without any coverage for lost or stolen
data? Think about your business, how are you protecting your data? Cybercrime is currently the fastest
growing crime in the world. Companies are increasing the amount of money spent each year fighting
computer, network intrusions and ransomware attacks, whether it’s by online fraud, identity theft,
cyber extortion or a data breach, criminals are becoming more brazen and sophisticated.

 The amount of ransomware attacks has significantly increased each year worldwide with Canada
     reporting a 103% increase according to a report by corporate security vendor: Sonicwall.

 Some cyber insurance carriers are seeing ransom demands in the six and seven figures, so loss severity
    (size of the loss) is also becoming an issue.

 The attacks have become much more automated so there is little interaction with the hacker.

 As well the attackers have started targeting smaller businesses because they know security may not be as

One recent example on PEI was a small contractor. They had their Hotmail account hacked. The hacker
was able to recreate invoices identical to the contractors sending them out and receiving payments for
completed jobs. The hackers were also intercepting e-transfers. In the matter of a few days the
contractor lost upwards of $10,000.

If you have a cyber-attack the implications are more than just calling up your IT people to fix the
problem. Have you considered the other costs involved? Are you aware of Bill S-4? Bill S-4 modifies
PIPEDA and says that you must record and REPORT breaches of security, meaning you must notify every
single customer that could have been affected by a security breach. If you do not notify customers, not
only will you be liable for fines up to $100,000 but you can also be named publicly. Also consider the
amount of revenue lost while your system is down, this can last days or months. In a ransomware attack,
for example, if you do decide to just pay the ransom to get back up and running quickly, chances are
they will come back to attack you again.

Though a cyberattack is stressful, having the right preparations in place can minimize the associated
damage and costs. A planned and practiced response, along with proper cyber risk insurance are crucial
to your cyber defense. There are many areas of protection on a Cyber Liability Policy that need to be
looked at, give me a call and we can start the process on a Cyber Liability Policy today. In the
meantime, here are some basic tips that if you are not already implementing, can easily be done right

- Keep your firewall turned on.
- Install and update antivirus software.
- Implement two factor authentications for passwords.
- Keep your system up to date.
- Be careful what you download.
- Turn off your computer at the end of the day.

Mary Beth McInnis BBA, CIP, CAIB

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