3 Key Things to Know About Cyber Risk Management for Manufacturing

3 Key Things to Know About Cyber Risk Management for Manufacturing

All businesses, regardless of size, are vulnerable to a cyber-attack. While hackers all have different motives, the primary reason for various groups of hackers is monetary gain. Through this, thousands of cyber breaches occur yearly, many of which do not make any major headlines.

Manufacturers are increasingly exposed to cyber breaches and the impacts as the industry moves towards building interconnected facilities and operations. Over the last 12 months, 39% of manufacturers experienced a breach resulting in losses between $1M-$10M.

3 critical points for Manufacturers to know about Cyber Risk Management and Insurance:

  1. Your General Liability policy does not typically cover cyber breaches, and if there are sub-limits, they most likely do not provide enough 1st party or 3rd party coverage.
  2. Business Interruption (BI) due to a cyber breach could impact a manufacturer’s supply chain, production, and order fulfillment. Ensuring you have proper BI limits and possibly contingent BI for your suppliers will help prevent disruption to your cash flow when a breach occurs.
  3. Motives include financial gain (68%) and Espionage (20%), which makes it a concern for intellectual property and contractors. Over one-third of executives believe that IP theft was the primary motive for cyberattacks experienced by their companies.

In this hard market, ransomware events have increasingly occurred, making cyber security a crucial subject in 2022.

The complexities of cyber insurance make it much more important to work with the right broker who can help you navigate the ins and outs of a cyber policy. Working with the right broker with credibility in this space and familiarity with underwriters and their expectations is critical in ensuring a sound underwriting process.

Contact us today to connect with an expert on our team who can evaluate your needs and help you get the most out of your cyber insurance policy.

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This document is intended for general information purposes only and should not be construed as advice or opinions on any specific facts or circumstances. The content of this document is made available on an “as is” basis, without warranty of any kind. Baldwin Risk Partners, LLC (“BRP”), its affiliates, and subsidiaries do not guarantee that this information is, or can be relied on for, compliance with any law or regulation, assurance against preventable losses, or freedom from legal liability. This publication is not intended to be legal, underwriting, or any other type of professional advice. BRP does not guarantee any particular outcome and makes no commitment to update any information herein or remove any items that are no longer accurate or complete. Furthermore, BRP does not assume any liability to any person or organization for loss or damage caused by or resulting from any reliance placed on that content. Persons requiring advice should always consult an independent adviser.

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