Partnership With Organizations Is An Important Step In Protecting Water Services

Cyber threats and data breaches are something we worry about every day, but they don’t just happen to personal financial accounts, banking institutions and tech companies. Our nation’s water utilities have become increasingly vulnerable to cyberattacks, which the American Water Works Association says “could cause devastating harm to public health and safety, threaten national security and result in costly recovery and remediation efforts to address system issues as well as data loss.”

The issue has become so significant that the White House released a statement in March 2023 detailing the complex threat that water utilities face from cyber breaches and emphasizing the need for software products and services to promote secure development practices.

Recognizing this need in 2021, David McNeil, Principal with EPIC Insurance Brokers & Consultants partnered with Allied Public Risk, LLC (APR), Alvaka Networks, CalMutuals JPRIMA and Lloyd’s of London. They worked for two years developing a customized cyber program for water utilities and water-related agencies seeking cyber coverage. The new product launch was announced this week by Alvaka Networks and CalMutuals JPRIMA.

“I am thrilled to be part of this innovative, cutting-edge product launch,” McNeil said. “The development process took more than two years, but we now have a cyber-insurance product that meets the specific needs of the critical water infrastructure sector.”

“We were able to come up with something that advanced the coverages and created a stabilized price option for water utility companies to have coverage no matter their size,” McNeil continued.

Water-related agencies have found it challenging to obtain cybersecurity coverage that is both affordable and comprehensive.

“In addition to critical patching services, Alvaka and EPIC will be working closely with our organization to provide cyber outreach and education throughout California,” said Susan Allen, CEO of CalMutuals JPRIMA. “This initiative is an important aspect of the program, as education is key to reducing the risk of cyber-attacks.”

The program is designed to increase cyber liability insurance quality, affordability and availability for members of CalMutuals JPRIMA. Although initially available for California companies, the team hopes to expand the coverage options to water utilities throughout the U.S.

Taking an Aggressive Stand

The threats that water utilities face include attacks against operations technology systems that control turning the water on and off, the level of chemicals that are healthy versus dangerous, and more. The information technology attacks include typical phishing, malware and spoofing, but once inside the system hackers may try to transition to the operating systems and wreak havoc. With the correct risk management defensive measures in place, such issues can be avoided.

“The partners in this endeavor understand the critical nature of their work, and we are committed to doing our part in providing critical patching services to ensure this sector is protected against the latest cyber threats,” said Kevin McDonald, COO and CISO of Alvaka Networks. “The recent announcement by the White House of a more aggressive approach to National Cybersecurity Policy, with heavy emphasis on water and other critical infrastructure, is an encouraging sign that the government is taking cybersecurity seriously.”

“This program is a significant step forward in JPRIMA’s mission to help organizations protect themselves against the ever-evolving threat of cyberattacks,” said Paul Fuller, CEO of APR and Lloyd’s of London Coverholder.

“In addition to the support from Alvaka, we leaned heavily on the expertise and guidance of David,” Fuller continued. “He helped us with the technical insurance knowledge to build an industry-leading program.”

Learn more about our Risk Management Practice.