Cyber attacks are constantly-evolving threat to businesses of all sizes, and both public and private entities. Cyber crime is arguably the biggest threat to businesses both nationally and globally. In 2015, Ginni Rometty, chair, president and CEO of IBM, covered the topic during that year’s IBM Security Summit in New York City. Addressing a group of CISOs, CIOs and CEOs from 123 companies in 24 industries she had the following comments:
“We believe that data is the phenomenon of our time. It is the world’s new natural resource. It is the new basis of competitive advantage, and it is transforming every profession and industry. If all of this is true—even inevitable—then cybercrime, by definition, is the greatest threat to every profession, every industry, every company in the world."
Cyber attacks have evolved past trojan viruses and basic phishing email scams targeting online individuals and businesses. Modern cyber crimes can affect smartphones, smart home products, cars, factory machinery, transportation systems, power grids and basically anything connected to a network. The anonymity level that the internet allows users to maintain creates an ideal landscape for tech-savvy criminals.
In February of 2018, The Council of Economic Advisors (CEA) published their report, The Cost of Malicious Cyber Activity to the U.S. Economy. According to the report, cyber crimes were estimated to have cost the U.S. economy between $57 billion and $109 billion in 2016. This estimate represents between 0.31 percent and 0.58 percent of the 2016 U.S. GDP, essentially between a third to a half of the value of the entire country’s goods and services.
The damage is only expected to increase. A study done by Juniper research predicts that, due to the rapid digitization of consumers’ lives and enterprise records, the cost of data breaches is expected to grow to over $2 trillion globally by 2019. The study’s findings also revealed that the average cost of a data breach event will exceed $150 million by 2020, as more business infrastructure gets connected. Most businesses are not even insured with a cyber liability insurance policy at all, let alone enough to cover $150 million in damages.
Businesses are beginning to “fight back” against the growing threat of cyber crime by adapting their budgets to allow adequate funding for cyber security services and cyber liability protection. It’s clear that cyber security needs to be made a priority for businesses of all sizes. Those that don’t, when eventually hit, may not be able to recover from the damages.
At Axis Insurance Services, we aim to help our customers identify their exposures and protect themselves. Founded in 1999, we offer insurance programs to a wide variety of professionals and industries including attorneys, real estate, healthcare, architects, and more, and also have a wholesale division. We pride ourselves on offering flexible insurance coverage tailored specifically to each customer’s needs. To learn more about our solutions, contact us at (201) 847-9175 to speak with one of our professionals.