Protecting Your HOA’s Sensitive Data from Cyber Crimes

Community association boards can use simple and inexpensive methods to protect sensitive data against cybersecurity threats and breaches, according to an insurance expert.

Kevin Davis, CIRMS, president of Kevin Davis Insurance Services in Los Angeles, suggests homeowner leaders and managers can increase their awareness and knowledge of potential cyber threats by asking questions and having conversations with vendors.

Davis says community associations board members have access to a lot of money and personal data but lack sophistication about cyber threats. They may believe sensitive information is secure but can be easily deceived into divulging information for fraudulent purposes if they aren’t paying attention, he says.

For example, if volunteers get unusual requests for bank and routing numbers, check it out before honoring the request. Once board members are duped and release the information, they can’t get the money back.

Sensitive personal data that associations have access to that cyber criminals want include social security numbers, account numbers and drivers’ license numbers, Davis says.

To prevent losses, Davis advises community associations to research and invest in cybercrime insurance policies to protect themselves in case of an attack or breach. Davis says it is critical for communities to have proper coverage and it doesn’t have to cost a lot. Cyber insurance policies include cyber liability coverage, ransomware coverage, cyber first-party coverage, wire transfer fraud protection, and crime insurance coverage, Davis says.

Installing multifactor identification, keeping computer systems updated, changing passwords regularly, shredding important paper documents and tightening up systems and policies to prevent insider threats are other ways boards can protect themselves in the digital age.

Davis says it’s also important to review management contracts and develop a plan in case management companies and third-party vendors don’t have appropriate insurance coverage against cyber threats and breaches.

Breaches can be expensive from a financial and human perspective. Forensic exams, legal defenses, fines and penalties, and ransom demands can strain community budgets, he adds.

“Think before you click,” says Davis.