Cyber insurance has become essential for all businesses, and this includes brick and mortar shops. Even if you do not sell any products online, your point of sale (POS) and card payment systems may still leave you vulnerable to attack.
How Can Hackers Target POS and Card Payments?
Cybercriminals know how to target your POS and card payment systems. Some cyberattacks are carried out in person and on your premises. A cybercriminal might use a USB or a similar device to install malware on an unattended terminal, or they may use your guest Wi-Fi to access your POS devices. But cybercriminals can also hack these systems remotely.
What Are The Risks of POS and Card Payment Breaches?
Once cybercriminals gain access to your POS and card payment systems, they can harm your shop and your customers in a number of ways:
- Cybercriminals might gain access to the data of any cardholder who uses a compromised machine. They could lead to identity theft and other forms of fraud, and it could even result in chargebacks for certain purchases. You may even face some legal action yourself as part of a wider fraud investigation.
- Cybercriminals may gain remote access to your systems, where they may steal your personal data or your customers’ personal data, or else cause some prolonged system downtime that could seriously compromise your operations.
- Cybercriminals may install malware that will encrypt your POS systems as part of a ransomware attack. You will not be able to process any payments until you meet their demands. If you fail to meet their demands, they may choose to steal your data outright, or they may simply delete it, which will lead to further downtime. All the while, you will miss out on revenue, and your reputation with your customers and suppliers may suffer.
What Does Cyber Insurance For Shops Cover?
Cyber insurance may not prevent POS and card system cyberattacks from occurring. But if you are the victim of a cyberattack, your cyber insurance policy can provide invaluable cover for your liabilities and recovery:
- Investigation – You will be covered for the costs of the IT forensics investigation, in which insurers will work to determine the cause of the breach, and identify the scope of the damage.
- Response – Your policy will cover certain crisis management procedures, such as notifying and supporting any customers who may have been affected by the breach. If necessary, your policy may also cover your PR, which could help you retain your reputation following an attack.
- Business Interruption – If your POS and card payment systems are compromised or offline, then your revenue will inevitably suffer. Your cyber policy can include business interruption insurance, which can cover any lost revenue while your systems recover.
- Other expenses – Your cyber insurance policy can cover any other expenses you might encounter during your response and recovery, which might include chargeback and card replacement costs, and the costs of replacing or restoring your terminals and other equipment.
- Legal Expenses – Finally, your cyber insurance can cover any legal fees that may arise if you are involved in any fraud investigations as a result of the breach.
What is Not Covered By Cyber Insurance For Shops?
While cyber insurance can provide invaluable cover should you find yourself a victim of a cyber attack, there are some circumstances where you might not be covered.
Prior Known Circumstances
You may not be covered from losses arising from problems arising from “prior known circumstances” – for cyber breaches that occurred even though you were aware of a certain vulnerability.
For example, if you notice a customer behaving suspiciously in your store, and you suspect that one of your terminals may have been compromised, then you may not be covered for any subsequent incidents should you fail to act on your suspicions.
Poor Security System Maintenance
Similarly, when you take out your policy, your insurer may ask you to specify any cybersecurity systems and procedures you currently have in place. If you make a claim on your policy, and your insurer finds that you failed to maintain these systems, then they may turn down your claim.
Cover Exclusions
Some cyber insurance policies may list a number of additional exclusions. You may not be covered for incidents arising from “acts of foreign enemies”, for instance, or for data loss that occurs as a result of a wider issue with your provider.
For more information about exclusions to your cyber insurance cover, be sure to read your policy wording.
How To Protect Your Shop From Cyber Attacks
Cybersecurity is a complex issue, and cybercriminals are getting smarter all the time. But here are some essential tips that could help you keep your shop and your customers safe:
- Updates
Keep all of your systems updated. Cybercriminals are constantly looking for vulnerabilities to exploit, and security updates are vital for closing these loopholes. - Wi-Fi access
Think twice about offering guest Wi-Fi. Set strong password protection, and never share your login credentials with anyone. - Training
Train your staff to understand the risks of cyberattacks, and the sort of warning signs they should look out for. - Physical awareness
Remember that some retail cyberattacks occur in person. Do not leave any terminals or other devices unattended at any time, as cybercriminals may be able to compromise your systems while your back is turned.
Get Specialist Cyber Insurance For Shops From James Hallam
James Hallam is an independent Lloyd’s broker with a dedicated team of insurance professionals who care about protecting your shop. We can help you access specialist retail insurance for your store, which can include cyber insurance.
Find out how we can help you today.