When you think of the phrase “cyber security”, pet insurance doesn’t typically come to mind. After all, what have cats and dogs got to do with digital data? Well, despite insurance being arguably one of the most secure industries in terms of maintaining and preserving member data, there is still some reason to be concerned. Here’s why.
The big players
In Australia, there is one major conglomerate that completely dominates the pet insurance industry. Hollard Insurance owns and underwrites almost every major pet insurance provider. This means that a data breach of this one company could result in a release of information for potentially 20+ companies at once. Now, while I’m sure we are all aware of the very small likelihood of this actually happening, it’s still a pretty big concern.
As with any insurance company, a data breach could not only result in the release of people’s personal finance information, but also pet ownership information, claims data, the ages of policyholders, information about annual premiums and even payment details. Imagine the catastrophe and the bad publicity that could result if someone managed to penetrate the walls of this underwriter.
It’s all about money
There is no excuse for being blasé about digital security when there is personal and financial data involved. Although pet insurance is one of the cheaper insurance types, especially compared to home insurance, income protection insurance or even car insurance, it doesn’t mean that there’s any less of a risk of a breach. That said, it should be noted that insurance brands have been predicted to increase their security this year.
Pet owners spend $490 million a year on pet insurance. This is hundreds of millions of dollars more than they collectively spend on other factors such as training, transport, walking and alternative healthcare treatments. Not only this, but the number of people taking out pet insurance in Australia is increasing year-on-year and has grown by 74% since 2013. This is a huge proportion of the ~24 million pets that live in Australia.
It’s still a small space
Let me rephrase that. The pet insurance industry is growing at an incredibly rapid pace. And although extremely unlikely, business growth can sometimes get out of control, which can lead to a lapse in security. One small oversight or human error could affect the security of millions of Australians and their pets.
In 2015, the Australian Government’s “Stay Smart Online” initiative released a report discussing the cost of cybercrime to Australian small businesses. The results? An enormous average of $176,323 per attack. From a business perspective, although they are underwritten by a large organisation, many individual pet insurance brands in Australia are actually still quite small. This means that the cost of damage control and risk management after a breach could send them under.
While this is currently not a huge concern, as with any industry, it’s important to consider the risks involved with handling the personal data of customers.