February 13, 2018 | Industry Insights, Shipping, Transportation
Roanoke Trade Launches Cyber Suite for Small to Midsize Logistics Service Providers
The clarion message from hackers today is that no company – large or small – is immune from cyber attacks, with their methods increasingly more sophisticated and targeted against those firms that transact a wealth of data online. This includes the transportation sector, which ranked fifth as the most cyber-attacked industry in 2016, according to IBM’s Cyber Security Intelligence Index. As an example, we witnessed earlier this year the attack that caused network outages against A.P. Moller-Maersk and cost the shipping company $300 million in third-quarter profits. What this far-reaching incident underscored for many in the industry is that if it can happen to shipping giant Maersk, it can happen to any of us in the logistics community.
Small logistics firms are particularly vulnerable to cyber attacks as they often lack the resources to implement strong cyber security measures. They also transact and share a vast mount of intellectual data online throughout the supply chain – from trade secrets to confidential pricing – with various third-party vendors. These vendors use many different platforms and don’t necessarily employ strong, if any, cyber security, leaving freight forwarders, customs brokers and others in logistics exposed to attacks and data breaches.
In addition, employee data is also at risk to cyber attacks with the cost alone to meet state regulations for credit monitoring and other requirements potentially running into the hundreds of thousands of dollars.
Up until now, it has been challenging for logistics service providers (LSPs) to purchase Cyber insurance to protect themselves in the event of a data breach, ransomware, or other exposure, and pay the resulting costs involved, such as forensics, remediation, credit monitoring, ransom, public relations, third-party lawsuits, and other related expenses. There are a number of reasons why LSPs haven’t carried Cyber insurance, including the cost of a stand-alone policy. Others haven’t realized the extent of the exposure and how vulnerable they really are or simply don’t understand the coverage that is available.
This has now changed with Roanoke Trade’s Cyber Suite, a program designed to provide comprehensive coverage to small and midsize LSPs with a price tag that’s affordable. Cyber Suite is backed by Hartford Steam Boiler (HSB), an A++ rated company at the forefront of developing cyber products, and part of Munich Re. It is exclusively available as an add-on to Roanoke’s Errors & Omissions (E&O) or Transportation Intermediary ProgramSM (TIP) at a fraction of the cost of a stand-alone Cyber Liability policy. The application for Cyber Suite is a simple one-pager that includes yes and no questions and it’s available for E&O and TIP policyholders today.
“We have been offering clients stand-alone Cyber coverage for years,” said Rick Bridges, Vice President, Roanoke Trade, and instrumental in the development of this product. “However, for smaller companies operating on low margins the cost has been challenging. In our efforts to provide our clients with an insurance and risk management solution to step in when a loss does occur, particularly in an environment where cyber threats are the new normal, we created Cyber Suite. We developed a product that is truly affordable, easy to understand, addresses the various exposures faced by our customers, and is hassle-free. We spent 18 months developing and testing our product, supported by the cyber experts at HSB to deliver a true solution that fits the needs of our clients.”
Cyber Suite offers eight coverages:
- Data Compromise Response Coverage: Responds in the event of a breach of personal data, such as employee information. This coverage includes among other things the cost of providing credit monitoring to the affected parties and public relations for reputational damage control.
- Computer Attack Coverage: Provides resources to respond to a computer attack.
- Cyber Extortion Coverage: Responds to extortion threats and covers forced payments.
- Data Compromise Liability Coverage: Pays defense and settlement costs in the event of a suit related to personal or business information.
- Network Security Liability Coverage: Covers defense and settlement costs in the event of a suit alleging that the insured’s system failure, such as malware, caused damage to a third party.
- Electronic Media Liability Coverage: Pays defense and settlement costs in the event of a suit alleging copyright or trademark infringement, defamation of a person or organization, or violation of a person’s right to privacy.
- Misdirected Payment Fraud: A first party social engineering coverage designed to respond when an insured is tricked into sending money to a fraudulent destination.
- Computer Fraud: A first party coverage where an unauthorized party gains access, and uses that access to enter or alter data, causing money to be sent to a fraudulent destination.
Cyber Liability limits are available from $100,000 up to $ 1 million, and are separate from the E&O limits on the policy. In addition, policyholders have access to e-Risk Hub, a risk management portal designed to help IT personnel and IT novices alike proactively manage their cyber risk. The cyber professionals at HSB manage all cyber claims and are also available to provide consultation to clients.
For more information about Cyber Suite, please contact your Roanoke Trade professional at 1-800-ROANOKE (800-762-6653).