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December 20, 2018

New Transportation Insurance Risk: Fleet Cyberattacks

Take a moment to think about the likely losses that result from a cyberattack. You’re probably focusing on things like data, software systems, wasted time and even your company’s reputation, right? But what about your company’s fleet?

We tend to think of cyberattacks as impacting only the cyberworld, but as more and more of our day-to-day operations become controlled by advanced computer systems, the line between the cyber world and the physical world starts to blur. For fleet managers, the potential real-world consequences of cyberattacks must be taken seriously.

Technological progress brings new risks.

New technology is generally intended to improve our lives. It often succeeds, but not without also creating new risks and unintended consequences.

The rise of telematics has been a great boon for the transportation industry. Fleet managers can use telematics to cut fuel costs while improving driver safety. For the first time ever, it’s possible to get instant feedback on drivers and trucks operating miles away, and to use the data created to make better, more informed decisions.

At the same time, the introduction of technology into key equipment carries risks.

The possibilities are frightening.

Hackers have long been able to take control of computers. Now they can take control of anything that connects to the internet. These days, that includes an ever-growing number of things. 

It’s not just hypothetical.

  • Smart refrigerators have been hacked, according to Network World.
  • Wired showed how hackers could gain remote control of a vehicle.
  • A ransomware attacked suffered by hotel locked guests out of their rooms, according to the New York Times.  
  • A security flaw in a smart thermostat makes it possible for hackers to raise the temperature by 22 degrees Fahrenheit, according to Newsky Security.

In other words, hackers could conceivably take control of your truck, change the temperature inside and lock you out. It’s easy to see how this could cause serious trouble for a fleet. Given this, it’s no wonder that Risk & Insurance listed the threat of cyber attacks on physical assets as one of the top six critical and emerging risks in transportation.

Protect your assets.

Although all these examples of scary hacks might make you want to throw in the towel and embrace a technology-free life, there’s no point in trying to go against progress. Instead, you need to keep up – or, even better, stay one step ahead.

You can minimize your risks by taking smart precautions:

  • Conduct a review of the smart equipment you use and the potential risks.
  • Whenever you consider purchasing new equipment, look at the cyber exposures and how to mitigate them.
  • Apply security practices for computer systems to other smart systems: change default settings, use strong passwords and keep systems updated.
  • Check your insurance coverage and talk to your insurance agent about covering your exposures.

Heffernan’s Transportation Insurance Division is here to help. Talk to your agent to learn more.

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