Financial Data
Updated 21 Jan 2019

Why cyber insurance is essential for real estate agencies

Cyber insurance is a must to keep increasingly valuable data safe in the Cloud or on the World Wide Web.

Simon Campbell-Young, 11 May 2018  Share  0 comments  Print

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Companies of all types and sizes can fall victim to cyber-attacks. From Google to Target, no company is too big, and even those with generous digital security budgets are hit. However, no company is too small either. It’s a myth that cyber criminals simply aren’t interested in SMEs or businesses in specific sectors, like real estate. 

Real estate agents have to face cyber security risks on a daily basis, including financial fraud, exposure of private customer information and so forth. Cyber criminals can ruin a realtor’s business, as many do not have the financial resources to withstand the losses – whether they be financial or reputational.

Better safe than sorry on the net

Although opting for cyber insurance may seem too expensive, it is far cheaper in the long run than the costs associated with recovering from a breach. Real estate agents put their heart and soul into their customers. Having cyber insurance to protect them and ensure their businesses can help them carry on in the event of a security event. In fact, cyber insurance should be seen as a ‘must have’, not an expensive option. 

Related: Why evolution in property technology is a win-win

Bear in mind that a company’s information is its most valuable asset and isn’t covered under general liability in insurance policies. Data is also more often than not what hackers are after. What happens to a business should its data be lost or stolen? Cyber insurance provides full coverage in this event, including data restoration costs. 

Another important factor to remember is that system downtime isn’t covered by most insurance policies. If your organisation is dependent on computers, servers and other digitally-enabled systems, an event that prevents you from sending and receiving data could be disastrous.

Retain your reputation

Remember that a company’s reputation is a top priority and can be damaged in a heartbeat. This is clear from the headlines that have littered the news. A good reputation is crucial to keeping the doors open. So, why not insure yours?

Even though some risks to reputation can’t be insured, real estate agencies can insure their reputations in the event of a security incident. Remember that the expense of rebuilding your reputation following a breach could be massive. Once your business has been compromised by attackers, your customers lose trust, which can be more harmful in the long run than a financial loss only. 

Cyber insurance would cover the costs of bringing professionals in to help mitigate the damage and rebuild your reputation.

Another area in which cyber insurance can help is in managing regulations and governance requirements. Complying with breach notification laws is a costly and time-consuming exercise. 

Businesses need to be aware of any applicable laws and have to notify customers should a breach take place. Cyber insurance helps cover those expenses.

Related: Trends to consider as a commercial real estate investor

Stay safe in a social world

Finally, social media is bringing a whole new slew of claims. A burgeoning phenomenon, social media is the fastest growing interaction platform in the world. Information is shared and exposed at the click of a button, but there is very little control over who says what, what they say, and how they say it. 

A staff member could inadvertently share confidential or sensitive information on a social media platform and the business could be held liable. This could include copyright infringement, or a slanderous statement. Cyber insurance can help provide cover for any claims arising out of this type of incident.

Given the multitude of risks that today’s real estate agencies face, the chances are more likely than not that your company might suffer a breach or cyber-attack. Without cyber insurance your business simply won’t be covered.

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About the author

Simon Campbell-Young

Having started his career as a startup partner for FSA Distribution in 1990, Simon Campbell-Young went on to start his own company called Memtek Distribution in 1995. This was sold to a public company called Siltek Holdings between 1998 to 2000. Shortly thereafter, he took his experience in the technology sector, garnered over more than 23 years, to form specialist distribution company Phoenix Distribution in 2000. Phoenix Distribution was then acquired by First Technology Holdings in 2008. Campbell-Young started Intact Software Distribution, another specialist distributor, a few years later, following that up with the founding of MyCybercare, a company providing cyber- and loss of funds insurance which is currently being rolled out globally. Under his leadership, all of these companies have expanded their footprint internationally.

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