Can Hackers Really Cause Commercial Property Damage?

by | Commercial Insurance, Cyber Insurance | 0 comments

Hackers Really Cause Commercial Property Damage

We’ve devoted a lot of attention to informing businesses about how to prevent a cyber attack. When addressing phishing prevention, malware, and ransomeware along with companywide roles and responsibilities the focus is always on the risk of leaked data and sensitive information. That’s enough on its own to call for greater cyber attack insurance coverage. However, did you know that hackers can also cause physical property damage to your place of business? In doing so, they may not only harm products, equipment, machinery, and your building interior/exterior, the events can also lead to bodily injury to customers, clients, and staff. Unsure of how a cyber attack can wreak such havoc? Let’s review!

How Cyber Criminals Can Inflict Physical Harm Upon Your Commercial Business and Inflate Insurance and Liability Risk Beyond Compromised Data

Power Outages

A power outage at the wrong moment can cause equipment to breakdown. When this occurs on-premises, it can lead to damage and destruction of machinery and the assets directly connected to it. Even if all that the power outage accomplishes is a “lights out” event for 5-minutes, it may cause staff to mishandle products or drive a forklift into a rack of inventory. From there, all sorts of injury and bodily harm can ensue.

It doesn’t take much to disrupt the operational flow within a commercial space. A hacker knows this, and can make it happen with a proverbial (and literal) flip of a switch.

Compromise of Your On-Premises IoT

The internet-of-things (IoT) is a term used to encompass all of the digital bells and whistles that now control our offices, shops, and warehouses. The web-enabled nature of our HVAC, lighting, and security systems intends to make commercial space management easier, but it also makes you vulnerable to another version of cyber crime.

For example, a hacker could subvert the software platform of an HVAC system and shutdown the refrigeration of climate-controlled products, leading to loss of entire inventory and subsequent financial ruin. In some severe cases, an HVAC compromise can lead to much worse. A cybercriminal can initiate overheating of a furnace to the point that it can cause a fire. They can disable the web-enabled sprinkler system to keep it from putting the fire out, which leaves the premises, its contents, and people within at great risk.

Compromise of Your Link in the Supply Chain

Commercial business that are a part of the supply chain are also threatened by hackers. Cybercriminals can control navigational systems and even hack into the software platforms of the very electrical vehicles used to bring products in and out of your warehouses. They are doing this even without vested interest or financial benefit. Think we’re exaggerating? Let’s recall one event where a 14-year old teen was able to remotely able to derail a train using a homemade transmitter. If the property of a customer, supplier, partner or other stakeholder is damaged due to a cyber attack upon your link in the supply chain, you could be held liable.


The call to action is clear. When protecting your business against the threat of hackers, you need to secure comprehensive commercial property, commercial liability, equipment breakdown, and cargo insurance as supplements to your cyber attack coverage. Contact Park Insurance today to schedule a consultation.

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