Is Your Business Safe From a Business Email Compromise Claim?

Author, Jeremy Hoolihan, Account Executive, Rancho Mesa Insurance Services, Inc.

Cybercrimes are at an all-time high. News sources report cybercrimes almost on a daily basis with most of the press relating to company breaches and cyber extortion. However, one of the biggest cyber threats that is often overlooked is Business Email Compromise (BEC).

BEC is a type of email cybercrime scam in which an attacker targets a business to defraud the company. BEC attacks use real or impersonated business email accounts to defraud employees. In 2020, BEC scammers made over $1.8 billion – far more than any other type of cybercrime.

In this type of cybercrime, the scammer sends an email that looks like it came from someone the recipient knows, like a superior or co-worker, and asks them to do perform a task. For example, the email may request:

• A change to a vendor’s mailing address so future payments are sent to the scammer and not to the actual vendor.

• An employee to purchase gift cards for a charity auction or employee rewards and then asks for the serial numbers on the cards so the scammers can use them without ever having the physical card.

• A client is sent an email with wire instructions for payment of an invoice that appears to come from your company, but instead it is for the scammer’s bank account.

BEC scams use a variety of impersonation techniques. The following 3 techniques tend to be the most common:

• A spoofed email address or website often has a slight variation from the legitimate address or URL. At a quick glance, the spoofed email address may fool victims into thinking it’s authentic. However, upon a closer look, an “L” might be switched out for a “I” or an “0” for an “o.”

• Phishing emails appear to come from a trusted sender in order to trick the victim into providing personal or confidential information like account numbers, usernames, personal identification numbers, passwords or answers to security questions. Then, the information is used to gain access to networks, accounts, and other data.

• Cyber criminals can infiltrate a company’s network using malicious software and gain access to networks and legitimate emails, often getting information about billing and invoices. This type of cybercrime is often unnoticed until it is too late.

For ways on how to protect your business from BEC claims, Rancho Mesa recommends first starting with a Cyber Liability policy. A comprehensive Cyber Liability policy will not only respond to BEC claims, but it can also provide coverage for other cybercrimes such as cyber extortion, cyber breach, and network security. If you have an interest in obtaining a Cyber Liability policy please feel free to reach out to me at 619-937-0174 or jhoolihan@ranchomesa.com.

Cyber Attacks Threaten One-in-Six Firms’ Survival

Author, Sam Brown, Vice President of the Human Services Group, Rancho Mesa Insurance Services, Inc.

The dramatic increase in cyber-attacks since 2020 has resulted in employer pain and made headlines as the economic cost skyrockets. The recent Hiscox Cyber Readiness Report 2021 states that the number of firms attacked rose from 38% to 43%. Not surprisingly, more than 28% of those employers suffered multiple cyber-attacks.

Determining the cost of a breach can be difficult, but the report states that one-in-six firms’ survival was threatened. Over 58% of firms hit with a ransom paid the threat-actors to regain access to the computer system and vital information. In 2020, the standalone cyber loss ratio increased to 73%, its highest level since separate cyber data were included in financial reporting, six years ago.

The increase in cyber-attacks and claim payouts is causing alarm in both insurance companies and businesses. According to the Insurance Journal, insurance companies are quoting significant premium rate increases and tighter coverage terms to improve underwriting performance and profitability. The average cyber renewal premium rate increased 11%. Meanwhile, written premiums for standalone cyber coverage increased 29% in 2020, a sign of growing demand.

The shift to a remote workforce and an increase in phishing email has tested network security systems. Fortunately, many insurance carriers now offer a cyber readiness assessment to help policyholders address vulnerabilities and avoid cyber-attacks.

As cyber-attacks continue, it is important for all employers to learn more about the specific exposures that cyber insurance coverage can cover along with ways to improve cyber security.

We will be offering a Cyber Liability workshop in the coming weeks, so be sure to look for that information on our workshops and webinars webpage.

Please contact me at (619) 937-0175 or sbrown@ranchomesa.com to discuss our process of developing competitive quote options.

Safe Cloud Computing for Contractors

Author, Drew Garcia, Vice President, Landscape Group, Rancho Mesa Insurance Services, Inc.

Even prior to the COVID-19 pandemic, many construction companies were utilizing some form of cloud-based systems to effectively streamline business operations and increase accessibility of information. While hosting sensitive data in the cloud has many benefits like shared access to data, applications and storage, there are some risks contractors should take into account before relinquishing their data to the cloud.

A leading provid//er of Cyber Liability insurance, CNA references three key risks companies utilizing cloud technology need to be aware of in an recent article, “Cloud computing 101: Getting clear about the cloud.” CNA explains data protection, data loss/disruption and inappropriate access are risks business take on in exchange for the benefits of cloud computing.

Data Protection

Protecting data is essential for any organization. Customers’ personal and payment information may be stolen by hackers once the data is stored in the cloud or even while in transit. So, your data in the cloud must be secured through encryption to prevent the data from being usable if stolen. As the cloud customer, the company should manage the encryption keys to ensure only authorized users can decrypt the data.

Data Loss / Disruption

You may be thinking about moving your data to the cloud as a way to protect it from electrical outages, fire, flood and other natural disasters. However, your cloud hosting provider can be left inoperable due to similar calamities. Before hosting your data in the cloud, review your host’s back-up and redundancies to ensure there will be a copy of your data available if something should happen to the host’s servers. Have a plan in place to help navigate your most critical information in the event something like this occurs. 

Inappropriate Access

When storing data in the cloud, it is imperative the company ensures stringent and complex user authentication. This may mean passwords are changed frequently or two-factor authentication is deployed to ensure hackers can’t find their way to your data. When you manage a large user-base, the risk rises. Ensure former employees no longer have access to your data by changing security rights or disabling their account. Complex user authentication can be an effective deterrent to keep those who should not have access to your information from finding their way into your network.

Assuming your information is safe and secure in the cloud is misleading. Be proactive in protecting your information and round out your risk management program with a strong cyber liability program that can fulfill your cloud based risk needs.

For more information about the CyberOne™ program, contact Rancho Mesa.

Article edited 4/19/2021.

Top 5 Cyber Threats for Contractors

Author, Sam Clayton, Vice President, Construction Group, Rancho Mesa Insurance Services, Inc.

Equipment and material theft as well as jobsite vandalism are exposures that unfortunately contractors have become accustomed to over the years. Over the last decade, however, the construction industry has seen a new threat arise and its name is Cybercrime. While the contracting community is likely familiar with this term, many mistakenly feel as though they are immune to this threat. With minimal personal identifiable information on hand,  few, if any, payments accepted through credit card and storage of data in the cloud, what is their true exposure? Below are five REAL cyber threats contractors are facing on a daily basis:

Ransomware entails encrypting company data so that it cannot be used or accessed, and then forcing the company to pay a ransom, typically in Bitcoin, to unlock the data. This type of cyber threat has grown tremendously in the last few years and is one of the most lucrative types of attacks.

Phishing involves the attempt to obtain sensitive information by getting employees to click a hyperlink or open an attachment in a phishing email. This could allow malware to install on a system, or take an employee to a fake website where they could enter sensitive personal or business information. Phishing scams can ultimately lead to employees being tricked into sending money via wire transfer to a bank account controlled by a cyber-criminal.

Malware Attacks encompasses a variety of cyber threats such as viruses and worms that are created to gain access to networks, steal data, or destroy data on computers. Malware usually comes from spam e-mails or malicious website links.

Password Attacks are big threats facing businesses with employees who use weak or easily guessed passwords. Using weak passwords for multiple logins can allow unauthorized users to access information through your company’s secured network.

Insider Threats is a risk to an organization that is caused by current and/or former employees and business associates. These people can access critical information and/or data through your company which can cause harmful effects through greed, carelessness, or ignorance.

Now, more than ever, companies need a strong Cyber Prevention Plan in place. This would include:

• Identifying your company’s most valuable information and where this information is located on your network.   

• Establishing Best Practice controls and procedures that consider both internal and external threats. 

• Communicating cyber security measures to the entire company and help your employees understand the threats your organization faces, and their role in protecting the company’s assets. 

• Adding a strong Cyber Liability Policy to your Risk Management Portfolio

To learn more about implementing a strong Cyber Prevention Plan and our CyberOne program, reach out to Sam Clayton at sclayton@ranchomesa.com or call 619-937-0164.

Edited 4/19/2021.

3 Cyber Threats of Employee Telecommuting

Author, Sam Clayton, Vice President, Construction Group, Rancho Mesa Insurance Services, Inc.

The recent coronavirus (COVID-19) pandemic has created numerous challenges for both individuals and businesses all over the world. Last week, California Governor Gavin Newsom required all residents to “shelter-in place” and all “non-essential businesses” to cease “in-person” operations. In doing so and in order to keep their business operating, many employers transition employees to work remotely, otherwise known as Telecommuting. 

While this approach is nothing new for many businesses, employers have been required to expedite these accommodations which creates unanticipated Cyber Liability Exposure.

Below are three online threats that remote workers should be aware of:

1. Secured WiFi Networks

Make sure that all employees are using a secure WiFi network. An unsecured or public WiFi network are prime targets for malicious parties to spy on internet traffic and collect confidential information.

2. Use of Personal Devices and Networks

Many employees will be forced to use personal devices and home networks for work. These devices often lack the tools built into company networks, such as strong antivirus software and firewalls. This lack of security could increase the risk of malware which may allow personal as well as confidential information being exposed.

3. Phishing Scams

Workers may receive emails from hackers impersonating a supplier/vendor or even someone within the organization to obtain confidential information or to transfer funds unknowingly.

In order to minimize these threats, companies should implement a written “Telecommuting Agreement” that outlines specific practices and procedures when employees are working remotely. 

For information on implementing these and other internal policies, visit www.ranchomesa.com/COVID-19 and login to our RM365 HRAdvantage™ portal. Contact Alyssa Burley aburley@ranchomesa.com in our Client Services Department to learn more about the platform.

The Flu Isn’t the Only Bug You Need to Worry About

Author, Sam Clayton, Vice President, Construction Group, Rancho Mesa Insurance Services, Inc.

Target, Capital One, and Equifax are all Fortune 500 Companies and household names we recognize. All have experienced a cyber liability breach in the last decade. When we hear of a data breach, we typically think of large corporations or more recently municipalities that collect customers’ personal identification information or are using technology to manage physical locations (i.e. buildings), transit systems, and people. However, just about any large, medium or small organization that uses technology to operate their business faces a cyber-exposure. And, as technology becomes more complex and sophisticated, so do the threats we face, which is why every business and organization needs to be prepared with both cyber liability insurance and an effective cyber security plan to manage and mitigate cyber risk. Below are two different cyber threats your company faces on a daily basis.

Ransomware is a type of malware that prevents users from accessing their system or personal files and demands a ransom payment, typically in the form of Bitcoin, in order to unlock and regain access to your data.

Social Engineering is the fraudulent attempt to obtain sensitive information such as usernames, passwords and credit card details by disguising oneself as a trustworthy entity via e-mail. This is typically accomplished by directing users to enter personal information at a fake website which matches the look and feel of the legitimate website.

A Cyber Liability Policy can help protect against data breaches and other evolving cyber exposures that are not covered by a standard property and general liability policy. These policies can respond in multiple ways such as credit card data remediation and notifications expense, network and information security liability, regulatory defense expense, crisis management expenses and computer program and electronic data restoration expenses.

In addition to the coverages above, many cyber insurers offer policyholders pre-breach services, employee training and IT forensics specialists. Some also provide data breach “coaches” who specialize in the unique legal and regulatory issues surrounding breaches, and will assist businesses with navigating the response process and ensure compliance with state and federal privacy laws.

Please contact Rancho Mesa to learn more about implementing a strong Cyber Prevention Plan.