Remote Work Cyber Coverage Gaps

Posted by John Cofini on Mon, May 11, 2020 @ 12:41 PM

remote-work-cyber-coverage-gapsMany companies have switched to remote work in response to the COVID-19 pandemic. As shelter-in-place orders are lifted, some teams may not want to return to the office. Whether it’s because people remain worried about the coronavirus or because they crave the flexibility and work-life balance that remote work offers, the work-from-home model may become a long-term arrangement for many workers. It’s time to fill in the remote work cyber coverage gaps.

Remote Work Creates New Risks

When employees work from home, they can inadvertently expose their company to new cyber risks.

Some of these risks come from security issues. Workers needs to protect their networks and devices with strong passwords, encryptions, installation of current security patches, anti-virus software and other security measures. Hopefully, managers have already guided their remote workers through this process by now – otherwise, it’s time to act.

But even with strong security measures in place, remote workers may still experience cyberattacks.  That’s why employers need another layer of protection: cyber insurance coverage.

Cyber Coverage Gaps Are Common

As the risk of data breaches, malware and other cyber threats has grown, cyber insurance has stepped up to manage these risks. Many companies now have cyber insurance – but this does not mean they’re fully protected.

According to the Insurance Journal, a study found that 90 percent of respondents experienced a cyberattack in the last year. Despite this, more than 40 percent of businesses had either no cyber insurance or had limits of $1 million or less, possibly not enough to cover an average cyberattack.

As workers move into home offices and cyber risks grow as a result, having robust cyber insurance coverage is more important than ever.

Cyber Exclusions Can Impact Remote Work Arrangements

It’s important to secure cyber coverage with sufficient limits. It’s also important to make sure your policy’s exclusions don’t leave out the types of claims you’re most likely to make.

Cyber policies may include exclusions related to remote work. For example, a policy may exclude bring your own device (BYOD) arrangements and the use of personal devices. Policies may also exclude devices that are not encrypted or fail to meet other security standards. These exclusions mean that, if a cyberattack occurs during remote work, a standard cyber policy may not provide coverage.

Consider the following situations that may occur if cyber insurance does not cover remote work:

  • A worker’s personal device is damaged during remote work. The company may be on the hook for the replacement cost.
  • A personal device is infected with malware that results in a data breach. The company may be on the hook for the costs of notifying and compensating impacted consumers, as well as possible lawsuits.

Fix Your Coverage Gaps

Currently, many teams that are working from home may have major cyber insurance gaps. As remote work becomes a long-term solution, it’s important to ensure you have the right processes and coverage in place.

  • Ensure that home networks and personal devices meet high security standards.
  • Secure robust cyber insurance coverage with sufficient limits.
  • Review your cyber insurance policies for exclusions that could impact claims during remote work arrangements.
  • Contact your agent to discuss any coverage gaps.

The team at BNC Insurance is here to assist with your risk management decisions. Contact us to learn more.