Cyber risk management for car dealerships
Andy Moss and John Ellison of Reed Smith discuss insurance and cyber-risk lessons from the CDK Global cyberattack.
Our increasingly connected world may open up a lot of possibilities for companies to expand their resources and reach, but unfortunately, it also presents an increasing number of vulnerabilities for cybercriminals to exploit. Recent reports show that the cost of cybercrime reached $8 trillion in 2023, and that is projected to increase to $10.5 trillion by 2025.
One of the latest major cyberattacks happened last month, when major car dealership software company CDK Global was hit by a cyberattack that impacted the more than 15,000 auto dealerships in North America that utilize their services.
For this episode of the Insurance Speak podcast, we were joined by Andy Moss and John Ellison, both partners in the Insurance Recovery Group at Reed Smith, to discuss the impact of the CDK cyberattack and what it means for car dealership cyber risk management and insurance coverage moving forward.
“CDK is a software provider to car dealerships throughout North America. It’s really a software-as-a-service type of provider, so dealerships rely on it very heavily for a host of different services which include things like titling vehicles, issuing license plates or license tags, amongst other things,” Moss explained. “We also understand that the type of information that dealers provide through the CDK software services includes sensitive information that prospective or actual car buyers might be providing to the dealership in order to get financing… So, think about all the information, if you’ve ever bought a car, that you have to provide… especially if you’re going to get credit to buy part of the car. So it essentially just crippled all, as you mentioned, about 15,000 dealers throughout the country.”
So, what is there for car dealerships to learn about insurance and cyber risk from this attack? To find out, listen to our full conversation with Moss and Ellison above or subscribe to the Insurance Speak podcast on Spotify, Apple Music or Libsyn.