www.mrca.org  —  Midwest Roofer
12
Compliance Issues: As governments tighten 
cybersecurity regulations, construction companies 
may face fines or other penalties if they fail to 
comply with data protection laws. For instance, if 
a construction firm handles personal data, it must 
adhere to regulations such as the General Data 
Protection Regulation (GDPR) in Europe or the 
California Consumer Privacy Act (CCPA) in the 
United States.
Building a Cybersecurity Strategy
Construction companies should develop a 
comprehensive cybersecurity strategy to mitigate 
the risks posed by cyberattacks. Key steps include:
Employee Training: It is essential to educate 
employees on cybersecurity best practices, such 
as recognizing phishing attempts, using strong 
passwords, and safeguarding sensitive data. A 
well-trained workforce is the first line of defense 
against cyber threats.
Regular Security Audits: Regular security audits 
can help identify company system vulnerabilities 
before attackers can exploit them. Audits should 
include both internal systems and those of key 
vendors and subcontractors.
Multi-Factor Authentication (MFA): Implementing 
MFA for all employees and contractors can 
significantly reduce the risk of unauthorized access 
to company systems.
Data Encryption: Sensitive data should be 
encrypted at rest and in transit to ensure that even 
if attackers gain access to the data, they cannot 
easily read or use it.
Incident Response Planning: Construction 
companies should develop and regularly update 
their incident response plans. These plans should 
outline how the company will respond to various 
cyber incidents, including ransomware attacks, 
data breaches, and insider threats.
Cyber insurance: This form of insurance helps 
businesses protect themselves against risks 
related to cybercrime and data breaches. It can 
cover costs associated with a data breach, such 
as notification expenses, data recovery costs, 
damages, legal fees, and other expenses related 
to managing a security breach. Additionally, it can 
often provide assistance in the event of cyber-
attacks, such as ransomware or phishing attacks.
Cyber insurance can be tailored to businesses’ 
individual needs. AXA XL, for example, recently 
announced a special endorsement for its cyber 
policy, specifically designed for construction 
firms. The endorsement extends coverage to cyber 
risks specific to contractors; for instance, there 
is Missed Bid coverage, which would reimburse 
a construction firm for income loss due to being 
unable to submit a bid because of a cyber security 
breach or system failure.
As the construction industry continues to digitize, 
the importance of cybersecurity cannot be 
overstated. While technology offers tremendous 
benefits, it also introduces new risks that must be 
carefully managed. By understanding the industry’s 
specific cyber threats and taking proactive steps 
to mitigate them, including buying tailored cyber 
insurance available today, construction companies 
can protect their assets, reputation, and bottom 
line in the face of an increasingly hostile cyber 
landscape.
CYBER SECURITY
 
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