Construction

With a Cyber Risk seminar taking place on 15 July at JLT, I found myself wondering "is cyber risk is really an issue for Building Contractors?"

I can see how it makes sense for banks and IT companies to insure against Cyber Risks as they have potential loss of revenue, profit, increased working costs and even potential liability losses to protect but do contractors face the same types of exposure? Is it worth them buying insurance to cover this type of risk?

Indeed, have construction companies even had time to give this exposure their full attention? 

These days, Contractors rely less on paper and more on technology to run their business, and as IT improvements increase so do exposures that are often not insured under their traditional insurance programmes.

What would the cost implications be if...
- A virus deleted all of the site data? Including drawings and calculations? 
- Or if all of the Employee data was posted on a public forum

Protection: I have a Fire Wall! And you have Employees...
All big companies have Fire Walls in place; however Employees sit inside the firewall... and that's where the problem lies. 

Whether malicious or accidental people make mistakes. Professional Indemnity will cover errors or omissions in the performance of a professional duty.  But if an employee deliberately plants a virus on your system and the result is your site (or many sites) are shut down for days, this would not be covered by PI. 

But, would the delay it be covered by your Property/BI?
Maybe not...  Also, there is no theft, so there would be no cover under a Fidelity Policy.

Under the Cyber Insurance, this is an insurable risk.  So the question is, should contractors be buying this cover?  How would shareholders react if a multi-million pound loss was insurable, but not insured and worse still... the cover was not even investigated?  Are construction companies not concerned about this type of exposure, or are they just not aware it exists?

Some key issues will be investigated at the JLT Cyber Seminar on 15 July.  It will also look at risk management methods for cyber exposure as well as the insurance solutions. 

I would be really interested to hear what your view on this exposure is for the Construction Industry.  Share them by posting a response to this blog or if you'd rather remain anonymous email me and in a few weeks I will post up the responses along with some of the interesting detail that came out of our Cyber Seminar.