Monday, February 2, 2015

The Importance of Business Interruption Insurance Coverage

Sony Pictures Entertainment recently found itself in the news for being hacked. The story goes to show that, if a major, multi-million dollar industry like Sony Pictures can be hacked, all businesses are vulnerable. To protect against that vulnerability, businesses are urged to have “cyber insurance,” which protects them in the event that they are unable to do business due to being unable to access their online systems, even if it’s just for a brief period of time.

In Sony’s case, the major industry had to shut down its systems in over 50 countries. Sony executives sat and waited in fear as the hackers threatened to release their secrets, with all employees worldwide shutting down any and all devices connected to Sony networks. The downtime would last for an unprecedented amount of two entire days, and the full problem (and peace of mind) probably won’t
be completely remedied for a few more weeks. 

The hackers did score some small “victories” against Sony. They released many of its movies, the majority of which haven’t even hit theatres yet, to download websites, which could cost the company big bucks in terms of ticket sales. Sony was reportedly devastated by the shocking turn of events, as any company would be. Losing access to technological systems, or, even worse, having the business secrets stored in these systems in front of the eyes of those who wish to do harm spells big trouble for any business.

Sadly, these types of “hackings” are a lot more common than you might think. In fact, Sony had its video game networked hacked just three short years ago, resulting in stolen data and outage time.

Obviously, there is a serious need for large companies like Sony and even smaller companies to have specialty “cyber” insurance that protects them in these kinds of circumstances. Fortunately, insurance companies worldwide have responded to this need and now offer unique policies to meet the cyber-security needs of individual businesses.

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