Cybersecurity alarms are sounding for North American auto dealers following a cyber attack that exposed serious vulnerabilities within the sector.
This incident served as an important reminder for businesses to ensure that they have a strong cybersecurity environment and highlighted the critical need for comprehensive cyber insurance policies that mitigate financial losses and support recovery efforts post-incident.
“While auto dealerships stand to gain significantly from digital advancements, neglecting to manage the risks can erase those advantages in an instant. With cyber incidents a stark reality in our digital age, the appropriate insurance is indispensable for a swift and secure recovery,” says Chetan Sehgal, Partner, Forensic Disputes Investigations.
How did the CDK Global outage impact auto dealerships?
In June 2024, CDK Global, which provides software to nearly 15,000 car dealerships across North America, was hit with back-to-back cyber attacks that left hundreds of dealerships offline. Dealerships found themselves scrambling to maintain operations, as the digital infrastructure they relied on for sales, scheduling, record-keeping, and customer management was rendered inaccessible. Many had to resort to manual, pen-and-paper forms of data entry throughout the two-week outage.
The incident is a stark reminder of the vulnerabilities facing the automotive sector and illustrates how a cyber attack on basic operational software can have profound implications for an entire industry.
Six steps to managing a cyber insurance claim
Responding to a cyber incident is a complex, nuanced, and sometimes chaotic process. As dealerships recover from the aftermath of a breach, they are juggling multiple important priorities, from restoring systems to recovering files.
Managing insurance claims is another critical task that adds to the complexity of their recovery path. To help you navigate through the chaos of a cyber incident, these six steps provide a structured approach to stay organized and on track with your insurance claim during recovery.
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Evaluating post-incident operational and financial losses
A cyber incident can trigger a cascade of challenges specific to auto dealerships, from compromised customer data to interrupted sales operations.
Understanding these areas is crucial for developing a resilient risk management strategy and ensuring a swift post-incident recovery process that minimizes the impact on your dealership’s financial health and reputation.
Supporting auto dealers in cyber incident response efforts
Our Commercial Insurance Claims & Advisory practice helps auto dealers navigate the complex process of cyber insurance claims from start to finish. Our team works with policyholders to independently quantify, compile, and substantiate complex cyber insurance claims.
We support you through streamlining documentation, communicating with insurers, and submitting supportable claims. Our goal is to help you resolve claims as fairly and efficiently as possible, allowing your auto dealerships to focus on business recovery while we handle the intricacies of the claim process, alongside your insurance broker.
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Read moreContact our team if you require assistance with managing a response to a cybersecurity incident or if you’d like to proactively enhance the cybersecurity defences of your auto dealership.