Large companies are investing in cybersecurity defenses and protections as cyber attacks become more sophisticated. With these larger companies being harder to breach, cyber attackers and hackers have focused their energy and attacks on small businesses with little invested in cybersecurity defenses. And those attacks are starting to put small businesses out of business for good.
If a cyber criminal is able to steal payment information or personal information that can be used for identity theft from someone storing sensitive information, such as a retirement plan, they can cause an interruption of business to a small business until they can contain a breach and by the time that happens, the costs may run the new business into bankruptcy.
This can happen even if your company is so new that it doesn’t have an active website or was not storing any payment information, as what happened to Innovative Higher Ed Consulting, Inc according to The Wall Street Journal. The two-person startup did not have a working website but cyber thieves ran stolen cards through their payment system that was not attached to an active site, leading to $27,000 in reversal charges. So even if your company is not storing payment or other personal information, cyber thieves can use stolen cards to cause you tens of thousands of dollars in charges, an amount that can easily be fatal to small businesses.
Ultimately, it is not just plan or beneficiary information you have to worry about. Cyber attacks can put your whole company out of business no matter how careful you are.
Small companies can protect themselves from cyber attackers with cyber liability insurance
Colonial Surety includes cyber liability insurance with our ERISA fidelity bond packages with fiduciary liability insurance to best protect your company plan against a cyber attack.
Colonial’s cyber insurance provides a services-based solution to help plan sponsors manage data breaches successfully. These services include a dedicated team of cyber breach professionals who assist plan sponsors at every stage of incident investigation and breach response. These professionals coordinate the carefully vetted forensics experts and specialized lawyers to help plan sponsors establish what’s been compromised; assess plan sponsor responsibility; and, notify those individuals affected. In addition, these services will also coordinate credit or identity monitoring, and PR advice to help the plan sponsor safeguard its reputation. Of course, Colonial’s cyber insurance also indemnifies and defends plan sponsors from covered lawsuits or regulatory actions, the risk of which may be reduced by a well-coordinated breach response, but can never be completely eliminated.
Ongoing governance and evaluation of recordkeepers can help protect data, but the only way to fully protect against a potential cyber attack’s data breach is to purchase cyber liability insurance from Colonial Surety Company.