Dennis Houseknecht, VP Partner Development, Waterloo Security Ltd.
Businesses large and small have to manage risk. They invest in risk-reduction measures, including fire sprinklers, alarm systems, security cameras, and employee training programs. The remaining risk is transferred through insurance.
What is the single biggest risk businesses face? It is not fire. It is not break-ins, shoplifting, or other traditional crimes. It is not floods or other natural disasters.
For the past two years, the biggest risk faced by businesses is……..Cybercrime.
Cybercrime has become more profitable than the illegal drug trade.
Who are the criminals? They are not just casual hackers or “script kiddies”. Cybercrime is perpetrated by highly organized and very well-funded criminal organizations. These are the same criminal organizations that rob banks, run illegal gambling operations and smuggle illegal weapons. Smart criminals go where the money is. The word “cybercrime” suggests something less nefarious than extortion or drug trafficking. That is unfortunate, because cybercrime is as ugly and malicious as it gets. Lives are ruined and companies are put out of business by cybercrime.
Who is helping your clients understand the risks? Who is helping them understand the importance of investing in security? If you don’t talk to your clients about security, who will?
As “business consultants” and “trusted advisors”, managed service providers have an obligation to their clients to identify and manage business risks.
Even the most effective preventative measures cannot eliminate all risk. Despite investments in fire prevention and suppression measures, fires do occur. Few businesses could survive the catastrophic losses associated with a fire, so they transfer the remaining risk through fire insurance. What about the greatest risk businesses face – cybercrime? Are our clients covered for those losses? In a future article, we will discuss ways to transfer the risks associated with cybercrime through cyber-insurance.
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