Risk & Business Magazine Jones DesLauriers Insurance Fall 2016 | Page 6

STAYING CONNECTED

BY: DINA GODINHO
PARTNER, ACCOUNT EXECUTIVE,
JONES DESLAURIERS INSURANCE

Staying Connected
How To Protect Your Business From Cyber Crime

P

.F. Chang’s China Bistro, a
popular US casual dining
restaurant chain, recently
suffered a payment card data
breach. About seven million
customer payment cards were involved
and P. F. Chang’s is now facing several
class-action lawsuits as a result.1 It’s
a common misconception among the
restaurant and hospitality industry
that a standard insurance policy would
protect businesses in case of a data
breach or that the credit card company
would ultimately be held responsible,
when, in fact, that’s not the case.

As a business owner in the hospitality
industry, it’s important to stay informed
on how to protect your assets, especially
with the rise of cyber and data crime. In
this dynamic and ever-changing world
of technology, business owners need to
realize that their operations are now
exposed to the world’s cyber criminals
and are vulnerable to attack at any
time—day or night. Identity theft, cyber

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crime, data extortion and telephone
hacking are all crimes that traditional
insurance policies do not address. Cyber
liability insurance fills this gap by
providing comprehensive crime coverage
for a wide range of electronic perils
that are increasingly threatening the
financial resources of today’s restaurant
and hospitality businesses.
As a restaurant owner wanting to
protect your business, here are a few
more reasons to consider cyber coverage
for your operations:
SAVE TIME AND MONEY
Complying with breach notification
laws will cost you and your business
time and money. These laws are slowly
being introduced across the globe and
generally require businesses that lose
sensitive customer data to provide
written notification to those individuals
that were potentially affected. Although
the legal obligation to notify individuals
is a gray area, this is changing and there

is a growing trend towards voluntary
notification in order to protect your
brand and reputation. Customers who
have had their data compromised expect
openness and transparency from the
businesses they entrust with it. Cyber
policies can provide coverage for the
costs associated with providing a breach
notice, even if notice is not legally
required.
PROTECT YOUR REPUTATION
Restaurants live and die by their
reputation. Although there are certain
risks to reputation that can’t be insured,
you can insure your reputation in the
event of a security breach. When your
systems have been compromised, you
run a risk of losing the trust of your
loyal customers which can harm your
business far more than the immediate
financial loss. Cyber insurance can not
only help pay for the costs of engaging a
PR firm to help restore your reputation
but also help pay for the loss of future
sales.