The 8 Cyber Components Underwriters Evaluate
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Cyber Liability Insurance for Real Estate Companies
Imagine that your customer files, financials and private information have just been breached. Actually, pretend you find out that your first breach happened months ago and you’re just now being informed.
This isn’t a rare occurrence these days. With the sophistication of hackers, your systems could be susceptible to this. Anti-virus programs, spam filters and firewalls are only as good as the latest version you have.
Real estate companies including property managers, portfolio managers, REITs and brokers all have sensitive material that hackers are looking for. Each one of these types of companies is a great target for a cyber/data breach because of the information on file.
Has your broker designed a comprehensive cyber liability policy to fit your needs? Does it cover you for first and third party liability? Are limits high enough to offset the cost of legal fees, monitoring services and crisis communication assistance to keep your company afloat?
These are just a couple of components to think about. Here’s what the underwriters are looking for when it comes to underwriting your business:
- Annual revenue
- Scope of business
- Security systems in place to protect data
- Risk transfer in place with vendors, contractors, etc.
- Number of records handled and kept
- Preplanning and safeguards
- Outline of who has access to sensitive information
A recent study by IBM and the Ponemon Institute states that the average cost of a data breach in the United States is $6.5 million, which has increased from $5.9 million in 2014. The study consisted of 62 companies with an average cost of $217 per lost or stolen record. The study also reported that cyber liability insurance purchases had more than doubled from 10 percent of companies in 2013 to 26 percent of companies in 2014. My advice to you is to ask yourself: Can my company afford to pay these costs out of pocket?
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