By Jennifer McDaniel ency had a data breach?
Cyber risk is best defined, Burke said, as a failure to safeguard a computer network, leaving it exposed to data breaches, ransomware and fraudulent funds transfer.
Personal lines agents, he said, often have access to sensitive information, such as Social Security numbers. And if that data is intercepted, a criminal could apply for a credit card, or even use it to make money with fraudulent claims against a client’ s health insurance policy.
“ Agents have a legal obligation to maintain certain standards to protect confidential information, and there are substantial repercussions if they don’ t,” Burke said.
But often, it isn’ t until businesses are notified by law enforcement or a credit card company, that a breach is identified.
One of the challenges Burke sees, he said, is that businesses have no idea where to turn once a data breach takes place.
“ When this occurs, we want to make sure our clients have a road map of what steps to take next,” he said.“ It’ s Risk Management 101.” Burke said he first recommends clients call a qualified attorney who specializes in cyber security cases and handles them frequently.
Often, attorneys, also called breach coaches, will determine the scope of the breach and how to proceed. Some investigations involve enlisting the help of professionals, such as forensic technicians, to assist.
“ With breaches, no two are the same, and you have to be really, really creative,” he said.
“ The cost is driven by the information exposed, and if you have to negotiate on the fly, that reduces your leverage; that’ s where insurance coverage comes in.”
| January- February 2017 | KANSAS INSURANCE AGENT & BROKER
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