Don’t let a headline like this show up in your local news source with your name next to it.
Security incidents of large companies are becoming so commonplace that most people are resigned to the idea of having their account hacked. Yet, most agents and brokers believe they are safe from hackers and laptop thieves. While some agencies may serve as access points to larger carriers, others are simply an easy target.
Feeling safe in this increasingly regulated and unsecure world is a misconception of the greatest proportions. Insurance agencies are directly liable to individuals and the government for misuse of client information. Meaning the government will fine you directly. And depending on the severity of the incident, clients have the right to sue you for negligence as well.
The costs stack up.
Depending on the type of information involved, you could have up to three government agencies breathing down your neck. The state attorney general and individuals affected will be looking for you as well. If you do manage to pay the thousands (or millions) of dollars in fines, the government entities don’t let up. They also issue corrective action plans, require third party risk analyses and you can bet your last dollar (if you have one left) that they will keep you on their watch list for the next ten years or so.
Still don’t believe it could happen to you? Let’s review two agent breaches that occurred just last year:
NFP – Maschino, Hudelson & Associates also had a laptop stolen from an agent’s car in April 2014. The laptop contained unencrypted files for nearly 4,000 individuals. You can find them listed on the Wall of Shame.
DeLoach & Williamson was an agency in South Carolina. Their breach also involved a stolen laptop with ePHI of more than 3,000 individuals. The company closed immediately following the breach investigation. They too can be found on the Wall of Shame.
Tomorrow we present a webinar about another insurance agency who closed due to a breach. Register here to learn more.