This put up is a part of a collection sponsored by AgentSync.
Information is on the core of the insurance coverage trade. From the smallest impartial businesses to the most important legacy carriers, insurance coverage organizations of all sizes home information. This contains distribution channel information like the knowledge collected and saved to license and appoint insurance coverage producers and adjusters, in addition to any client information these companies collected within the strategy of promoting insurance policies.
Yep, the insurance coverage trade just about runs on information. Nonetheless, this reliance on delicate private and monetary info additionally makes insurance coverage organizations a chief goal for cybersecurity assaults.
Cyber assault charges are up within the insurance coverage trade
Over the past decade, the insurance coverage trade has gone via a fairly excessive digital transformation. Businesses, carriers, MGAs, and each different trade participant in between have migrated away from handbook workflows and legacy techniques in favor of extra sturdy digital options for his or her day by day operations.
Insurance coverage organizations that prioritize tech modernization supply their workers, prospects, and distribution companions a extra seamless expertise, however there’s a value to progress. Because the insurance coverage sector migrates towards extra digital channels, the risk of cyber attacks increases exponentially.
As we spherical out Cybersecurity Consciousness Month, we figured now’s the time to supply an summary of a few of the prime cybersecurity dangers insurance coverage organizations presently face together with a couple of finest practices for safeguarding your information and your backside line from an assault.
Key cybersecurity dangers within the insurance coverage sector
Information breaches
With regards to cyber assaults, information breaches are a prime concern and one of the important threats going through not solely insurance coverage organizations, however nearly each enterprise throughout each trade. Even big-name gamers like Apple and Verizon have fallen prey to information breaches prior to now. It is because hackers can entry and expose a company’s information via various totally different strategies, together with:
- Malware
- Insider threats
- Phishing
- Ransomware
- Software vulnerabilities
- Password guessing
- And lots of, many extra
In March of 2024, Fidelity Investments Life Insurance Co. experienced a data breach that compromised the non-public information of greater than 28,000 of their prospects. Cyber criminals obtained delicate info together with names, Social Safety numbers, financial institution accounts, and birthdates of Constancy policyholders via a hack at one among their third-party suppliers.
Past monetary losses, insurance coverage organizations may additionally face authorized liabilities, injury to their popularity, and lack of buyer and companion belief on account of a breach.
Social Engineering
You’d by no means give away delicate info to somebody you don’t know (we hope!) however what when you thought the ask got here from somebody you knew and trusted? Social engineering happens when a cyber legal manipulates a person into giving up confidential info, typically by posing as somebody the person trusts. What can appear to be a innocent e-mail from a coworker asking you to click on a hyperlink or obtain a doc, would possibly truly be a intelligent means for hackers to infiltrate your techniques and compromise your information.
As soon as hackers acquire entry to a system via social engineering, they’ll shortly deploy different assaults like distributing malware or information breaches, inflicting much more monetary and reputational injury.
Theft and Fraud
The shift to extra digital channels and touchpoints means a major variety of monetary transactions within the insurance coverage trade happen on-line. Whereas this makes issues simpler and extra handy for everybody concerned in insurance coverage distribution, it additionally opens companies as much as a better danger of fraud.
Cybercriminals are more and more concentrating on insurance coverage firms to commit fraud. From identification thefts to extra advanced schemes like claims manipulation, each year insurance fraud costs the industry an estimated $308 billion.
Shield your information and your backside line by following these cybersecurity ideas
Whereas no firm is 100% resistant to a cyber assault, there are methods to minimize your danger. Insurance coverage organizations can observe the following tips to make sure their information is locked down, compliant, and protected from exterior threats:
Tip No. 1: Require multi-factor authentication throughout all techniques
Multi-factor authentication (MFA) has shortly develop into a typical of information safety in lots of industries, and insurance coverage is not any exception. MFA ensures that earlier than a person logs right into a system they’ve gone via no less than two totally different factors of authentication.
Sometimes, MFA entails a person coming into their commonplace login credentials together with a one-time passcode despatched to them through textual content or e-mail. Having a number of identification verification checks makes it harder for unauthorized people to sneak in by stopping attackers at a second authentication stage even when a password is compromised.
Tip No. 2: Prioritize ongoing safety consciousness coaching
As frontline defenders, workers play a significant position in figuring out and mitigating dangers like phishing assaults, fraud, and information breaches. Providing (or higher but, requiring) common coaching periods can equip your workforce with the information and expertise they should acknowledge potential threats.
By demonstrating a dedication to ongoing cyber-security coaching, you foster a tradition of vigilance at your group. And since we within the trade understand how shortly issues can change and new improvements can come up, steady coaching is a should. Ongoing schooling ensures your workers keep updated on the most recent threats and finest practices, reinforcing their understanding of compliance necessities and safety protocols.
Tip No. 3: Create an incident response plan
Within the unlucky occasion that your information is compromised, it’s at all times a good suggestion to have a response plan in place. Fairly than panicking put up cyber assault, making a plan for restoration is a proactive strategy that may assist decrease injury, cut back downtime, and protect your total popularity.
A well-defined plan improves preparedness by figuring out potential vulnerabilities and outlining methods for restoration. When crafting your plan, ensure to outline clear procedures and duties for responding to totally different incidents. And don’t overlook to replace and check your plan usually to make sure workers are aware of their roles.
Tip No. 4: Assess your third-party vendor information hygiene
Utilizing third-party distributors is on the rise within the insurance coverage sector. With extra insurers and businesses partnering with third-party suppliers for no less than one element of their digital transformation, a company’s information safety success relies on the safety and preparedness of any software program is companions with.
To make sure your techniques, in addition to any distributors you could companion with, are safe, compliant, and able to safeguarding delicate info, your group wants a stable safety framework. SOC 2 is a strong framework designed to assist companies navigate the advanced panorama of information safety and regulatory compliance.
Extra particularly, a SOC 2 Sort II audit assesses any controls and processes a enterprise has associated to information safety, availability, confidentiality, and privateness. Selecting distributors who’ve carried out a SOC 2 Sort II audit helps insurance coverage trade companies:
- Shield client information
- Keep compliance
- Construct buyer and companion belief
- Enhance operational effectivity
- Mitigate danger
- Achieve a aggressive benefit
And that’s simply to call a couple of of the advantages!
Information safety ought to by no means be an afterthought
With extra information and extra breaches, the flexibility to be resilient to cyber assaults is shortly changing into a core requirement for insurance coverage organizations. As cyber threats proceed to evolve, prioritizing information safety from the outset ensures that sturdy defenses are built-in throughout all operational processes.
One of the best ways to keep away from a cyber assault is to remain diligent in assessing and updating you group’s safety requirements and cyber-hygiene practices, together with that of any software program distributors you’re employed with.
If you happen to’re contemplating partnering with AgentSync for extra trendy and seamless producer licensing and compliance administration at your service, company, or MGA/MGU, then you may breathe a sigh of reduction. Our merchandise are constructed on a zero-trust structure and we’re very happy to stroll you thru all of the methods during which we prioritize your information safety. To study extra, check out a demo, or talk to an AgentSync expert right now.
Subjects
Cyber
Data Driven
