The internet is an invaluable business tool for motor traders. But the risk of cyberattacks on businesses is growing – and the motor trade is no exception.
The recent hacking of major dealership Holdcroft Motor Group is a clear example of why traders of all sizes should consider protecting their liability online.
Family-owned Holdcroft Motor Group represents nine franchises and has 23 locations across the Midlands and North West England.
According to local news articles, the major cyberattack in late July 2022 caused ‘significant damage’.
While customer data was uncompromised, data relating to employees and possibly stretching back years was said to be affected, and the hackers demanded a substantial payment following the attack.
The incident, currently being investigated by the police, the National Cyber Operational Unit and the Information Commissioner’s Office (ICO), underlines the continual threat motor trade businesses face from cybercrime.
These days, motor traders hold more and more customer data as a matter of course, such as names, addresses, bank details, vehicle details and more.
This information is an essential part of running a business – enabling the completion of sales, vehicles services, repairs and the like to be carried out efficiently.
But the loss of this data could have high cost implications, including fines and compensation claims.
Plus it could trigger a loss of trust from customers, slowing down business recovery.
Vehicles themselves are also becoming increasingly reliant on connectivity.
New car technology and systems are more remote controlled and automated than ever before, including centralised security systems.
Many models today can be controlled through an app – from unlocking the doors to tracking location.
But these features are all vulnerable, and if a vehicle is hacked while at a garage or dealership, the motor trader could be held liable.
But one of the most important points to understand about cybercrime is that 90% of incidents stem from human error.
Criminals are more likely to target the human rather than the technology – and all it takes is one person to click on the wrong link for a business to be seriously disrupted, or even crippled.
Fraudulent transactions could leave a company out of cash and unable to operate, while the reputational damage of a hack could last for months or even years.
Currently, some of the most common forms of cybercrime include:
- Hacking, such as email passwords and social media accounts to gain access to confidential information
- Social engineering – where the hacker pretends to be from a trusted organisation to gain sensitive data, such as passwords or bank account details
- Malicious software like ransomware, often disguised as a harmless file.
It’s incredibly easy for an employee to click on the wrong link or download a malicious file simply by mistake.
Scams are sophisticated and even the best anti-virus software cannot prevent the actions of the person behind the screen. That’s why cyber liability insurance should now be a serious consideration for every motor trade business with an online presence.
Liability cover offers protection for cybercrime incidents, as well as support for business interruption, system damage and data breaches – while helping to cover the costs of any fines and penalties.
Many providers also offer vital pre- and post- breach risk management training to ensure staff members are as up-to-date as possible on cyber threats, and minimise the risk of falling for a scam.
Ultimately, the internet is an indispensable tool for nearly every motor trade business, but it does leave every trader at risk.
By reviewing cyber liability, it’s possible to protect a business from the potential devastation an online hack can cause.
To find out more, or to discuss your cyber liabilities with friendly specialists in the motor trade, simply call 0330 174 3482 or send an email to [email protected].