Change in the restaurant industry is a hallmark of the pandemic. Expected to reach revenue of nearly $1 trillion in 2023, the restaurant industry increasingly faces cyber as one of its greatest risks.
In the last 5 years, such well known brands as Taco Bell, KFC, Pizza Hut, Jason’s Deli, Arby’s, Sonic, and Chipotle have fallen victim to hackers. Wendy’s faced a class action lawsuit from financial institutions due to losses from attacks. Hackers are known to target small-to-medium sized businesses without the same sophisticated protections as mega corporations.
Even as restaurants are returning to pre-pandemic levels of revenue, the financial structural changes are unlikely to go away: increased reliance on online ordering, digital payments, and QR codes.
This change has greatly increased restaurants’ exposure to data breach, notification costs, and forensics costs. Cyberattacks may also include destruction of advertising on social media and electronic platforms, which regularly result in banishment from the platforms and loss of reputation.
An attack may force a restaurant to slow or halt operations, resulting in loss of income. Restaurants operate on such a low margin, even a small slowdown or halt could end the business. Cyber is as risky as a customer slip-and-fall.
Cyber premiums are lower for businesses with better security. Just like a restaurant that enforces better protections against fire have lower property premiums, the same is true for Cyber policies.
In the last 5 years, such well known brands as Taco Bell, KFC, Pizza Hut, Jason’s Deli, Arby’s, Sonic, and Chipotle have fallen victim to hackers. Wendy’s faced a class action lawsuit from financial institutions due to losses from attacks. Hackers are known to target small-to-medium sized businesses without the same sophisticated protections as mega corporations.
Even as restaurants are returning to pre-pandemic levels of revenue, the financial structural changes are unlikely to go away: increased reliance on online ordering, digital payments, and QR codes.
This change has greatly increased restaurants’ exposure to data breach, notification costs, and forensics costs. Cyberattacks may also include destruction of advertising on social media and electronic platforms, which regularly result in banishment from the platforms and loss of reputation.
An attack may force a restaurant to slow or halt operations, resulting in loss of income. Restaurants operate on such a low margin, even a small slowdown or halt could end the business. Cyber is as risky as a customer slip-and-fall.
Cyber premiums are lower for businesses with better security. Just like a restaurant that enforces better protections against fire have lower property premiums, the same is true for Cyber policies.
Do your validating producers understand when Cyber is needed, or know where to learn about it? Insurance Technical Consulting specializes in one-on-one mentoring of commercial producers so they gain confidence in what they are selling and make fewer errors. Save your agency time with potential to increase revenue and reduce E&O costs. Explore the website at InsuranceTechnicalConsulting.com for more information.
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