Cyber Security in Finance and Insurance Industries

    Financial systems are at the heart of the global economy. This makes cyber security in finance a necessity for protection. J.P Morgan Chase was attacked and suffered a significant breach in 2013. The breach saw the personal information of 76 million households, about 65% of all the US households, compromised. Now they spend nearly $600 million to strengthen and keep their cyber security measures up to date. Fintechs are responsible for safeguarding customer data, as such attacks are dangerously common.

    The insurance industry used to suffer from inertia in adopting modern technologies. The industry has slowly taken steps towards adopting, experimenting and building more vital fronts against cyber attacks. With the coronavirus pandemic, digitization and work-from-home structures have led to technological advancements. But the advancements come with a proportional rise in cyber risks and fraud in the insurance industry.

    Read to know the importance of cyber security in the finance and insurance industries.

    What Is a Cybercrime in the Banking, Financial Services and Insurance Industry?

    In the insurance industry, much private personal data is stored about the policyholders. This private information is the prime target for cybercriminals. Since the pandemic, attacks on private information have increased in severity and frequency. The insurance sector is under pressure from all sides to update their systems against cyber threats.

    Customers see the value of having an app for accessing critical data while digital banking and viewing their insurance policies. The responsibility to provide visibility at the same time while pursuing data protection is on the shoulders of the insurance provider. Since everyone has at least one kind of insurance, policies must contain contact, financial, and health information to purchase one policy. The availability of private information makes the insurance industry a hot target for hackers.

    What Are the Main Cyber Threats in the Finance Sector?

    The finance industry has several threats that need to be addressed from a cyber security perspective. It continues to be under the threat of cyber risks of all sophistications, from click-based phishing to using AI. Due to COVID-19, the gross number of attacks on the financial sector has increased by 30% between 2019 and 2020. The attacks are classified into frauds (43%), data breaches (34%), and disruptions (23%).

    One of the biggest threats to the finance industry is the weaponization of AI. AI is behind technologies used by several financial institutions. However, a similar AI algorithm is being deployed and developed to aid cybercrime and attack the integrity of financial institutions with a payment structure. Hackers use AI to identify vulnerabilities for them to capitalize on. The AI can mimic human behavior and convince users to disclose sensitive information that can compromise several structures. On the other hand, banks have been investing in developing tools to prevent fraud. And it focuses on making users aware of healthy practices to safeguard user data.

    While threats are often unorganized, Advanced persistent threats or APTs, are cyber threats sponsored by a group. They gain unauthorized access to a network and remain undetected for a long time in stealth. This practice is a form of cyber espionage, and banking has been the primary target for attacks orchestrated like this. In 2015, 800 million to a billion USD were stolen in the Carbanak Case from banks worldwide. This malware attack gained access to employees’ passwords and was used for spoofing several accounts.

    What Can Happen in a Cyber Attack Caused by Negligence?

    Human errors and negligence play a massive role in data breaches. While the brand value takes years to build, it can break away in seconds. Cyber attackers have recently relied on a lack of awareness and discussion on cyber security to execute breaches. Basic cyber security etiquette involves understanding the risks of handling your customer’s data. When an unknown link is clicked, crucial information like private data can be cloned and used for malicious purposes. Reused passwords across online platforms create unaccountable risks for all platforms to be compromised when even one is breached through malware. For finance companies, the responsibility to keep updating high-privilege accounts is paramount as they are connected to the whole system. The admin account’s login credentials are often not updated and have inadequate security protocols; this makes them an easy target for hackers. Cyber negligence leads to companies facing huge losses on legal grounds and a complete loss of public trust and market value.

    What Are the Expectations from a Cyber Security Provider?

    Innovation and strategy will be the first step in envisioning a safer operation for your organization. A risk management strategy provided by a cyber security provider has to include several styles of reaching the answer instead of being systemic and stringent. This strategy has to be embedded in decision-making and be agile when treating transformations of large scale. Risk management is about preparing for risks and building defenses driven by organizational prioritization. The last goal has to minimize the scale of disruptions while keeping the pace of operations. This will allow for smooth functionality of systems even under testing conditions.

    Bug Bounty: Your Cyber Security Solution

    Through bug bounty, companies gain access to a global pool of unlimited expertise at their disposal, allowing them to stay ahead of emerging threats. Furthermore, businesses can take additional steps to establish secure procedures and policies that encompass all layers of their systems. This allows organizations to strengthen their security against malicious actors and become more resilient in the long run.

    What Are the Cyber Security Measures That a Finance or Insurance Company Should Take?