How secure is your electronic marketplace?

Your computer system may be secure, but how much do you rely on a Third Party customer or a supplier’s platform for your orders to be placed and then passed to you for processing?

Businesses are dealing more and more with e-commerce companies that place orders on behalf of their customers for the purchase of a whole range of products and services. These orders are placed via the website platform of the e-commerce company and then sent to the individual businesses to fulfil these orders and for them to deliver direct. The suppliers are then paid by the e-commerce company for the orders that have been fulfilled.

What happens to the orders and revenue of the suppliers if the e-commerce company’s website platform is subject to cyber-attack and as a result they don’t receive any orders?

Here’s an example: you sell your craft goods on Etsy.com.  Etsy suffer a cyber-attack and subsequently has significant down-time, which in turn stops you from receiving orders.

Although there has been a reduction in turnover, this is not covered by the Business Interruption section of a standard Commercial Policy, as there has not been a loss caused by an insured peril e.g. Fire or Theft

This loss would need to be covered as an extension to a Cyber Liability Policy. You would be covered by a Cyber Liability Policy as long as the e-commerce company’s website is operated for your benefit and there is a contract in place between you and the e-commerce company.

Does this sound like a problem that your business may encounter?

If you want to discuss this in more detail or need some further information, please contact me or a member of our team on 01302 341 344.

By Martin SingletonDip CIIAccount Executive

 

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