GUEST BLOG: Cyber Liability for Self Storage – Big Risk for Small Business
Submitted to Investment Real Estate by Jessica Lamoureux at Storage Insurance Brokers
Self storage facilities want to give the impression that they will keep their tenants’ belongings protected. A lot of money and effort goes into appearance, safety and security at facilities. But what is less often addressed is protecting customers’ personal information. From credit card numbers, driver’s licenses and possibly social security numbers, self storage operators store a large volume of data. This data comes with big responsibility.
It is a common misconception that owners believe they are protected by their third-party software and credit card vendors. It is important to choose vendors that offer the most secure systems, however it ultimately comes down to the merchant’s responsibility to handle the repercussions of a cyber attack when it does happen.
A cyber attack can come from many avenues. A break in at a storage facility where physical files are stolen, or an employee stealing customer information are obvious exposures. Cyber criminals can gain access through servers or hardware devices such as laptops, desktop computers, tablets and USB devices as well as Wi-Fi networks. It is important to keep devices and software up-to-date with individual passwords. Hackers target software that is outdated and small businesses are the low hanging fruit due to unsophisticated IT protocols. This creates a very large exposure for self storage facility operators.
According to Chubb Insurance, “Ninety-three percent of small and midsize enterprises that have experienced a cyber incident reported a severe impact to their business. Almost all reported a loss of money and savings. Thirty-one percent reported damage to their reputation leading to a loss of clients, as well as difficulty attracting new employees and winning new business. And nearly half reported an interruption in service that damaged their ability to operate. In spite of those figures, less than three percent have cyber insurance.”
A Cyber Insurance policy is a very cost effective way to protect your business from the exorbitant expenses that could occur with a cyber attack. Some insurance companies include a small sublimit for cyber or data breach coverage, but it usually is not broad enough to cover the full range of expenses that could be associated with an attack. A good cyber insurance policy should cover expenses related to notification of current and past tenants, credit monitoring, legal fees, settlements, fines and penalties, forensic investigation, loss of business income as well as a public relations/reputation management services.
In summary, a cyber attack is a real possibility for a self storage facility operator. If an incident occurs, it is important to have a partner who can step in with the experience and strategy for immediate response so you can continue to focus on your business with peace of mind.
If you would like to learn more about how to protect your self storage business with a cyber insurance policy, visit https://www.worldinsurance.com/storageinsurancebrokers/about or give Jessica a call at 860-372-4106.
About the Author:
Jessica Lamoureux is the Program Manager for Storage Insurance Brokers, a national self storage property and casualty insurance program and division of World Insurance Associates, LLC. World Insurance serves more than 34,000 customers from 22 offices in NJ, PA, NY, CT, RI, FL, ME, OH and Washington, D.C. and places more than $300,000,000 per year in annual premium.