Managing Cyber Liability Risks in the Hospitality Industry
Cyber attacks have the power to devastate a company both financially and reputationally. While the actual figures of suffering a breach are not exact, it’s estimated that the total cost of repair is approximately $4 million. If this isn’t enough to scare you into equipping your business with a Santa Fe Cyber Liability Insurance policy, we’re going to cover the additional risks that the hospitality industry faces.
The risks.
According to Hotel Management, the hospitality industry is particularly at risk, in part because hotels offer guests greater technological access and more interconnected systems, which simultaneously increase the risk of a data breach via their properties’ public WiFi networks, new mobile-enabled key cards, data-sharing networks with third parties, and point of sale (POS) purchases.
These alone account for about 45 percent of breaches in the hospitality industry, according to Trustwave’s 2016 Global Security Report, which also stated that the hospitality industry suffered the highest share of POS breaches among any other industry. Still, the hospitality industry has been slow to address their scope of risks.
Why they’re targeted.
This industry is particularly prone to attacks, especially when you factor in the interconnectivity between hotel chains. Most of the employees at these establishments aren’t the most well-versed in cybersecurity or computer practices as most of the jobs are centered around customer service, which makes them ideal targets for hackers. If hackers gain access to the database for one location of a chain, they likely can get more personal information from the remaining locations.
A lack of standardization.
Historically, cyber liability policies have lacked standardization and consistency on coverage. Premiums are based on a company’s industry and services as well as data risks and exposures, computer and network security, privacy policies and procedures and annual gross revenue.
Based on the various risks above, this is an imperative policy for hospitality risk management strategies. As many hotels are run by corporate chains, their central POS system and data management software needs to be protected in the highest degree. If these were breached, the entire corporation would be at risk for legal and reputational damage.
It’s important to note that cyber liability insurance doesn’t just cover the fees associated with data record recovery. In fact, it extends coverage to public relations costs, forensic investigation, litigation, notification costs, and more.
Being proactive.
The best way for the hospitality industry to address their cyber liability concerns is to comb through their exposures (as listed above), make note of them, and create a response plan. Without one, a cyber liability policy is only reactive rather than proactive.
About Daniels Insurance, Inc.
At Daniels Insurance, Inc., we have a unique understanding of the risks that businesses like yours face on a regular basis. With the backing of our comprehensive coverages and our dedication to customer service and quick claims resolution, your business will be fully protected. For more information, contact us today at (855) 565-7616.