The Apple Watch and other wearable technology is talk of the town amongst gadget lovers. With Statista estimating that worldwide sales could reach 111.9 million in 2018, wearable tech is likely to have a significant impact on consumer lifestyles and business processes over the coming months and years.
In the excitement of innovation it is easy to overlook some of the practicalities from a risk and insurance perspective. Cover for the device itself is important in terms of loss, damage and/or breakdown. However, the more significant risk can exist in terms of data loss, you must understand the exposure to your business, mitigate risk, and consider Data Loss and Cyber Liability Insurance as appropriate.
The Risk of Data Loss
An over-reliance on mobile and digital technology can expose you and your business to security breaches and other cyber attacks. According to a survey by PricewaterhouseCoopers (PWC) in 2014, a staggering 60 per cent of small businesses in the United Kingdom suffered a data security breach.
Now with the advent of wearable technology such as the Apple Watch, Google Glass, and Fitbit or other fitness trackers, both your own individual vulnerability and that of your business, in terms of breaches in cybersecurity will increase dramatically.
Why Is Wearable Tech More of A Risk?
Wearable technology offers users a simple and flexible, fully functional alternative to similar devices such as smartphones or tablets. Wearable technology will generally have communication capability (internet or telephony), can store data on the wearer, as well as providing access to real-time information. If your employees access sensitive company data using wearable technology, that technology can expose your organisation to the risk of a data breach.
Despite the risk of increased exposure to cyber-attacks, wearable technology can provide your company with operational benefits. But the amount of risk that you invite upon yourself, as well as your company, depends on how you manage the risks associated with wearable technology.
The Benefits of Wearable Tech
Any article of clothing or accessory that has a computer or advanced electronic technologies integrated into it is considered to be wearable technology. This modern design allows the device to be highly mobile without users needing to compromise on functionality or comfort.
Some of the main business benefits if you incorporate wearable technology in the workplace include:
- According to a University of London study, employees are, on average, 8.5 per cent more productive when using wearable technology and 3.5 per cent more satisfied in the quality of their work.
- Fitness trackers promote healthier lifestyles among your employees through collective goals that boost team performance and build a sense of community. Typical collective activities include holding a contest to reward the person or department with the highest number of steps.
- Employee tracking through wearable tech is another potential advantage, often increasing productivity and task allocation, particularly when dealing with remote workers performing manual tasks.
- Wearable technology can also increase accountability and productivity of employees through location tracking, recorded video and/or photographs. Wearable technology can even collect employees’ performance data in real-time, giving you an on-demand snapshot of their productivity.
The Risks of Wearable Tech
While the potential day-to-day benefits of wearable technology can offer your business profitability and productivity benefits, it is important that you also examine the associated risks when you consider whether wearable tech is right for your firm.
The following are some of the main risks associated with wearable technology:
- Unauthorised recording and documenting of sensitive data, confidential information and personal information associated with your products, employees and company.
- Possible unknown health risks associated with prolonged exposure to radio-frequency energy – all of which could impact your long-term Liability Insurance exposure.
- Lack of relevant regulation concerning how an individual can revoke personal information should a wearable device be lost or stolen.
- Health information that is recorded by a wearable device is not currently protected by the Data Protection Act 1998.
- Most standard Office Insurance cover does not automatically include wearable technology nor the personal information stored on the device.
- Breaches in cybersecurity leading to the loss or theft of personal and/or confidential information from cyber attacks and data breaches, which could lead to significant compensation claims.
These are just some of the potential risks to your business and employees due to the introduction of wearable technology, it does provide clear context and guidance when developing your risk management programme.
Managing the Risks of Wearable Tech
Inevitably, wearable technology will become more and more common over the coming months and years. With this in mind, it makes sense to take some proactive steps to safeguard your business information and data.
The following tips should help you to start to build your risk management framework:
- If you or your employees access sensitive information, send emails or conduct any sort of business, be sure to only use a secure, password-protected connection.
- Use complex and unique passwords for all your accounts.
- Engage your IT department to review the potential risks of wearable technology and other smart devices and what solutions your business could implement to stop risks from happening.
- For business meetings, ensure that wearable technology and other smart devices are turned off to prevent sensitive information from being unknowingly recorded.
- Outline specific use guidelines for wearable technology in your company’s Bring Your Own Device (BYOD) Policy.
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A robust risk management programme and BYOD policy can assist your business in controlling the risk of data loss, allowing you to lead the way in IT development.
As well as protecting your data, it is important to consider the physical loss to smart devices, wearables and tablets across your business. While cover can often be arranged as an extension to your Office Insurance, you may also want to consider a more robust Business Mobile and Tech policy for more comprehensive protection.
Insync specialises in cover for small to medium-sized businesses across the UK. We can Compare Office Insurance from the UK’s leading providers in minutes, helping you find the right level of cover at the right price.
Alongside office cover, we would also recommend you consider protection for Data Loss and Cyber Insurance, protecting your liability from hacking or accidental loss of business or personal data and associated cost.
Request a quotation online, or alternatively, why not book a free review with one of our expert Gurus who can help you to identify your specific risks and arrange the right level of insurance protection.