That “after the breach” feeling is especially difficult when you know the data your customers have been sharing could be at risk. It’s important to reassure them and get them as prepared as possible for what they may experience. Make sure they understand how to protect themselves and their information, and offer support in continuing that protection.
One of the biggest risks to any organization is reputation – good and bad. When something goes wrong, be it in our personal lives or at work, often we spend significant amounts of time and resources cleaning up the mess caused by a third party. No matter how well we clean things up, the reputational hit to our organization will continue to cost us in lost business down the road.
Without a proper plan for managing third-party risk, businesses could face costly consequences. For example, if a business outsources its customer service to an unreliable provider, they may experience serious problems with customer satisfaction. In addition, if a business does not have adequate insurance coverage for the risks posed by third-party partners, they could end up paying out large sums of money in damages. As such,
The cost of neglecting cyber risk
Organizations need to be vigilant when it comes to protecting customer data from being accessed or stolen in manners that could adversely affect the company’s business. Third party access and privileges are a common cause of data breaches, inflicting significant financial losses on companies annually.
Third-party vendors are integral to the modern organization. As such, their risks are your risks. Purchasing from a third-party without fully understanding the company’s risk profile is risky, as is contracting with a vendor who has an uncertain history or weak track record. Furthermore, relying on third-party providers can lead to outages and system vulnerabilities that could adversely affect business operations. It is important to identify and assess any potential risks associated with using third-party vendors before
Cyber insurance provides an organization with a layer of protection in the event that data is compromised or leaked. While it is important to manage third-party cyber risk and protect customer privacy, accidental emails containing personal information could lead to a data breach. Costs associated with remediation can quickly add up, so cyber insurance can help avoid costly damages.
It’s no secret that cyber security is becoming increasingly important for businesses of all sizes. Between the increasing incidence of data breaches and the fact that cybercrime costs businesses an estimated $508 million each year, it’s clear that vulnerability assessment and prevention are essential areas of focus. However, despite these warnings, a 2016 study found that only 38% of survey respondents reported having any kind of cyber insurance policy in place. This gap in understanding may be due to the fact that many people believe Cyber Security is something only big organisations need to worry about – but this couldn’t be further from the truth.
Assuming you are taking the necessary steps to prevent unauthorized access to your online information and systems, having Cyber insurance may not be required. However, if an incident were to occur and information was stolen or pilfered by a third party, cyber insurance can provide financial protection in the event of litigation or damage claims.
How to manage third-party risk
Third-party cyber risk is a real business concern for many organizations. However, many firms rely on manual processes to manage the risk, despite the acknowledgement of third-party cyber risks as a priority by decision makers. This lack of proactive management can lead to missed opportunities and increased vulnerability to attacks. By implementing robust risk management strategies, companies can minimize the potential for exposure to third party cyber risks and maximize their opportunity for success in this area.