Everyone loves the convenience of mobile technology and the internet—especially criminals.
From connected homes, cars, smartphones and tablets to social media, online banking and financial management, connected technology is weaving itself as deeply into our lives as it did business—only faster. The spread of technology into the lives and lifestyles of successful families and individuals opens up new avenues of risk and potential loss, including identity theft and risks to reputation and privacy.
Engaging in activities like blogging, Tweeting, and Facebook and LinkedIn posting, or using websites for commerce or entertainment, publicly exposes what used to be our closely held personal information.
Children, often unbeknownst to parents, are also on social media sites or texting personal information to their friends and acquaintances.
Studies show that the affluent are more likely to be identity theft victims than the general population. This makes sense, not because successful people and their children are more active on or vulnerable in their behavior with technology, but because their wealth makes them more attractive targets to begin with.
Like the general public, affluent households have embraced online finance management, often using email to connect with their banks to arrange a wire transfer or pay a bill. Criminals, in turn, have become very sophisticated in their efforts to infiltrate email accounts with the intent to virtually appropriate the account holder’s identity and send plausible messages to banks requesting a payment or transfer.
Connected technology is weaving itself as deeply into our lives as it did business—only faster.
A client of ours recently discovered that his email had been hacked when someone purportedly acting on behalf of an auction house requested payment for a painting the client had ostensibly purchased. The banker receiving the request realized the client was overseas and could not be at the auction, and, fortunately, did not send the payment.
Moving with the times, carriers catering to affluent individuals and families are providing identity-theft coverages and partnering with cyber-security firms to offer noninsurance solutions. But getting the right mix of both can be complex. It’s important that your private client insurance advisor understand the nuances of this exposure.
Similarly, the web complicates privacy-protection reputation management for wealthy families and individuals. Because of their stature, the affluent will often find themselves in an unwanted spotlight, named, for instance, in a business-related lawsuit simply for their deep pockets and casual connection with an alleged perpetrator, rather than any actual wrongdoing.
Information spreads quickly from a news or social column to search-engine sites and beyond, with potentially severe effects. For example, we know of a dentist who conducted online research after his practice slowed by 30 percent. This man discovered that a single posting on a review website had falsely alleged that he used substandard tools and his office lacked hygiene. Those allegations were turning off customers.
Some personal excessliability policies feature crisis-management endorsements that pay for PR expertise to help clients restore their reputations. Cyber-security firms also offer ways to mitigate this exposure.
But, again, getting the right coverage and advice is key—and often tricky. A savvy insurance advisor can help simplify the gathering of suitable coverage and resources.
This article was originally published in the August/September 2016 issue of Worth.