Posts Tagged ‘financial’

Should Your Business Have Cybersecurity Insurance?

Posted on: October 31st, 2012 by billp | No Comments

You run best-of-breed security software in your business. Your firewall is from a top-tier vendor and hardened. You run regular penetration tests on your network to make sure your exposure is in check. You even encrypt your data and enforce strong password policies on your network.

These are all excellent security practices, but they are hardly foolproof measures. They may slow down a cyber attacker, but a determined attacker with your business in their sights may still be able to find away to your data. The sad truth is that the cybercriminals are advancing just as fast as the technology designed to thwart them. The cybercriminals are also focusing more on less-risky, less-prepared targets such as small and medium businesses.

For a business owner or executive in charge of technology or risk, the problem is two-fold. All of the technology measures just described are excellent approaches to addressing cyber risk. But what about the risk associated with financial losses or liability that could result if the technology-based protective measures fail? Specifically, will your insurance policy cover losses, damage, and liability?

You may think that your small business general liability or property insurance policy covers data-related losses, but don’t assume anything without checking with your provider. Many policies include an “intangible property exclusion,” which would exclude data because you can’t touch it or feel it. That makes it difficult to calculate the value or replacement cost for insurance companies, so their normal policies simply don’t cover it. However, with businesses increasingly relying on electronic assets as a vital part of their business operations, insurance companies are starting to either add on cybersecurity protections to traditional policies or add entirely new cybersecurity insurance policies as options.

Cybersecurity policies can insure against data loss, liability associated with data loss, the cost of downtime to your business, and the cost of restoring lost or corrupt data. This kind of coverage is commonly referred to as “first-party coverage.” If your business deals in sensitive customer personal information (credit card numbers, health information, etc.), policies can also cover the exposure and expense associated with the loss of such information (credit-monitoring services, notifying customers, etc.). This kind of coverage is commonly referred to as “third-party coverage” (i.e. losses associated with third parties).

Cybersecurity coverage goes hand-in-hand with proper technological preventative measures. Your auto insurance provider likely offers discounts for added safety features on your car, a safe driving record, etc. Similarly, cybersecurity insurance providers will want to see due diligence in the form of preventative measures to protect your business data. If your coverage level is high enough, providers may want to see advanced security measures such as mandatory complex passwords, high-strength data encryption, protection against removal of data on portable devices, etc.

The best place to start is by contacting your insurance provider to find out the limits of your current policy. If cybersecurity coverage is offered, consider how important your data is to your business and how severely impacted your business would be in the event of a loss. If your business deals in sensitive customer data, you have even more to consider in the form of third-party losses.

Is your business data and network well-secured? Contact us at (888) 600-4560, email us at or contact us on Facebook or Twitter (@coldenco) if you want to check your current security measures or investigate ways to improve your security.

Managing IT in an Unpredictable Economy

Posted on: September 29th, 2011 by jiml | No Comments

In an uncertain economy, many businesses are reluctant to make investments in their technology infrastructure.  This is an understandable reaction to today’s business environment, although statistically many businesses do have the cash flow. Our caution would be to keep in mind that if you are running your business the same way you were a few years ago, you are not standing still, you are falling behind.  Rapid enhancements to technology ensure this. New competition and even your existing competition may be investing in technologies that are providing competitive advantages.  It is very possible that this is the time to invest in technologies that can help your business retain its edge.

When we talk about investing in technology, we are not talking about investing for the sake of investing.  We are talking about investing in items that bring a return on that investment e.g. new tools that can help close more sales. Take the time to evaluate your business and determine what the impediments to success are. Use this top-down approach to then indentify the systems and technology infrastructure that support those systems.  Perhaps an improved CRM system would help your business capture more business opportunities. Perhaps look to find a lower cost ERP system that may have equal functionality and better long-term growth potential. After selecting the system, the technology can be reviewed.  This step requires the cooperation of both your Chief Operating Officer and your Chief Technology Officer. Evaluate cloud based solutions, virtual computing solution, or Software as a Service (SaaS) solutions to see if any of these provide a better long-term price point or added value for your business. Always bear in mind that the technology is secondary to the business function it supports, but the technology can indeed add or subtract to the overall productivity significantly.

Technology can also be used to help reduce costs, not just increase revenue as with the previous examples.  Virtual technology is a great example of this.  Why operate two or three different physical servers when you can combine the functions of these three into one physical box running separate virtual computers?  The hardware costs are less, the energy costs are less and the ongoing maintenance costs are less.  Investing in this type of upgrade can result in reduction in long-term costs for a business.

As a final thought, when considering your budget for 2012, keep in mind that older hardware will fail more often. That is a mechanical fact.  At Colden Company Inc., we always remind customers that it is not “if” a hard drive will fail, it is “when”.  They are just mechanical devices that will eventually stop working, just like a car.  We understand that there are upfront costs involved in making your IT infrastructure more stable and efficient, but there are also increased costs with maintaining an aging infrastructure both in terms of equipment repair and lost productivity.  As your organization begins building the 2012 budget, look to invest in the types of technologies that will help reduce long-term costs or increase long-term revenues.  These actions will help keep your business competitive in an uncertain economy. Are you busy preparing for the future or in “maintain” mode?  Here are two thoughts to leave you with:  1) Failure to plan is planning to fail. 2) Remember, if you are running your business the same way it was a few years ago, you are falling behind your competition.

Options for Business in Uncertain Economic Times

Posted on: November 1st, 2010 by jiml | No Comments

As we prepare our budgets for 2011 and evaluate the business needs, there are some extenuating circumstances that should be considered.  The Small Business Jobs Act of 2010 allows for greater write-off of capital expenses, which means less tax for your business. Please see the following links to get complete understanding of the ramifications of this legislation.

Unfortunately, computers and networks do not care about the economy.  They age and fail regardless of the economic climate surrounding them.  There are options that should be considered so that your business is not left with failing infrastructure during difficult times. 

  • Leasing is often a forgotten option.  Equipment and certain services can be leased over time eliminated the upfront cash expenditure. 
  • Cloud-based services such as Software as a Service or Backup as a Service also can help reduce the upfront costs by eliminating the hardware expenditures and using the cloud for that purpose.
  • Virtualization can also reduce on-going maintenance costs by reducing hardware and better utilizing the existing hardware. For example, in our own office we have reduced the number of physical servers by 50% by virtualizing which has reduced our hardware maintenance costs.

In uncertain economic times it can be difficult to justify upgrading your technology infrastructure, but it can be even more costly when equipment fails when your business needs it most. There are responsible options for organizations who cannot afford to have that happen.