Cyber Coverage

Managing Cyber Risks in a Down Economy

Wells Insurance
cyber crime attack

Amid widespread inflation issues and rising interest rates, some financial experts have forecasted that the United States will enter a recession—a prolonged and pervasive reduction in economic activity—in the near future. During a recession, businesses usually experience decreased sales and profit margins stemming from changing consumer behaviors, prompting them to reduce spending to avoid issues such as bankruptcy. Furthermore, a down economy can also create heightened cybersecurity risks.

In particular, an economic downturn can result in businesses of all sizes and sectors facing limited IT spending capabilities, elevated skills shortages, additional insider threats, compounded cybercrime concerns, greater nation-state exposures and reduced innovation capabilities. Altogether, these issues could significantly minimize companies’ digital defenses and make them increasingly vulnerable to cyberattacks. Fortunately, there are steps businesses can take to combat cyber risks in a down economy, including the following:

  • Have a plan. Cyber incident response plans can help businesses establish protocols for mitigating losses and acting swiftly amid cyber events. Successful plans should outline potential cyberattack scenarios, methods for maintaining key functions during these scenarios and the individuals responsible for such functions.
  • Conduct training. Employees are often the first line of defense against cyberattacks. That’s why it’s important for businesses to prioritize cybersecurity training. This training should center around avoiding interacting with suspicious emails and links; refraining from downloading attachments or software programs from unknown sources or locations; utilizing unique passwords for all workplace accounts; and never sharing credentials or sensitive information online.
  • Purchase cyber coverage. Especially during an economic downturn, it’s imperative for businesses to have sufficient insurance. Companies should consider purchasing dedicated cyber coverage to ensure financial protection against cyber losses.

Contact us today for additional risk management guidance.