Why insurers need cybersecurity that protects against insider threats

Insurance companies face a high risk of insider cybersecurity threats due to their access to sensitive customer data, financial information, and proprietary algorithms.

Insider threats, often underestimated, can be as damaging as external cyberattacks. Insiders – current or former employees, contractors, or partners – have inside knowledge and access that make them particularly dangerous. Insider threats can be intentional, driven by motives like financial gain or revenge, or unintentional, resulting from careless behavior. Common unintentional threats include social engineering, where individuals are tricked into disclosing confidential information.

The consequences of insider threats

In insurance, insider threats can include unauthorized access to customer data, theft of intellectual property, tampering with financial records, or damaging critical systems. The consequences of these threats can be severe, leading to financial loss, reputational damage, regulatory fines, and legal issues.

Though insurance firms often keep insider threat statistics confidential, industry reports reveal their prevalence. The 2024 Verizon Data Breach Investigations Report shows insiders were responsible for 35% of data breaches, highlighting the widespread nature of these threats.

Examples of insider threats in insurance include a 2018 case where a former employee stole confidential client data for identity theft, and another where a claims adjuster inflated claims, resulting in financial losses. These incidents demonstrate the potential for insider threats to exploit vulnerabilities within insurance companies.

How can insurers protect themselves?

  • Control access: Limit access to sensitive information based on the principle of least privilege.
  • Monitor and audit: Use monitoring tools to detect unusual activities and potential threats.
  • Train employees: Educate staff on cybersecurity best practices and the risks of insider threats.
  • Boost data protection: Encrypt data, use data loss prevention technologies, and update security measures regularly.

Given the significant risk posed by insider threats, insurance companies must adopt robust data security practices and proactive risk management to protect their assets and reputation.

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