The Dangers of Internet of Things (IoT) Devices for Your Business

The Internet of Things (IoT) refers to the billions of Internet-connected smart devices used in homes, businesses, and industries worldwide. While IoT devices provide convenience and efficiency, they also pose significant cybersecurity risks if not managed properly, making cyber insurance important. 

As IoT devices continue to become even more prevalent, businesses need to make sure they’re protecting themselves against evolving cybersecurity threats.

Here’s what you need to know about the dangers of unsecured IoT devices and best practices for securing your business’s growing ecosystem of connected devices.

The Explosive Growth of IoT Devices

The number of IoT devices is growing at a staggering rate. There are currently over 30 billion IoT devices worldwide, and that number is expected to surpass 75 billion by 2025, according to Researchgate.

These devices include everything from smart home assistants like Amazon Echo and Google Home to internet-connected cameras, smart appliances, wearables, and industrial control systems.

While both homes and businesses are adopting IoT devices, their use in business settings poses particular concerns. Retail, manufacturing, healthcare, and critical infrastructure sectors like energy and transportation rely heavily on IoT sensors, system controls, and remote monitoring, exposing them to attacks from cybercriminals.

Risks of Unsecured IoT Devices

As IoT adoption spreads, one of the biggest problems is that many devices lack even basic security features. Default passwords often go unchanged, software and firmware lack regular security updates, and encryption is not consistently implemented. 

These security flaws allow cybercriminals to exploit IoT devices and gain access to business networks and data.

Some of the major risks introduced by unsecured IoT devices include:

• Botnets: Hackers commonly infect poorly secured IoT devices with malware and use them to build armies of bots. These botnets can be weaponized to launch DDoS attacks, send spam emails, or distribute malware across the internet. The powerful Mirai botnet brought down major websites by infecting hundreds of thousands of IoT devices.
• Data Breaches: IoT devices frequently collect and transmit sensitive data. When this data is not properly encrypted as it travels between devices and back-end servers, it can be intercepted by hackers. Breaches can expose customer data, intellectual property, trade secrets, and more.
• Critical Infrastructure Disruption: As crucial infrastructure adopts automated IoT systems, any disruption to these can have catastrophic effects. 
• Malware Infections: Malware can quickly spread between interconnected IoT devices and other endpoints on business networks. Once infected, IoT devices can be used to deliver malware across the organization.
• Compliance Violations: Regulations like HIPAA require technical safeguards when dealing with sensitive data. Unsecured IoT devices may not comply with such policies, putting the organization at risk of steep fines.

Securing Networked IoT Devices

The massive scale of the IoT landscape makes security an enormous challenge. However, with careful planning and vigilance, businesses can reduce their exposure to IoT threats. 

Here are the best practices every organization should follow:

• Inventory All Devices: Maintain a frequently updated inventory of all IoT devices used in your environment. This helps you monitor for suspicious activity and enforce security policies.
• Change Default Credentials: Always change the default username and password on devices to prevent unauthorized access. Use strong credentials unique to each device.
• Enable Encryption: Require TLS encryption for data in transit and enable disk encryption features on devices to protect stored data.
• Enforce Least Privilege: Limit access and capabilities to only what is essential for each device to operate. This reduces the available attack surface.
• Segment Your Network: Place IoT devices in separate virtual networks to limit lateral movement in case of compromise. Restrict communication between IoT and business networks.
• Install Updates: Ensure devices and their software/firmware are always fully up-to-date with the latest security patches. Sign up for automatic updates where available.
• Monitor for Threats: Use EDR software and other threat detection tools to watch for signs of compromise, like unusual traffic or device behavior.
• Control Access: Use firewalls and network access controls to only allow trusted connections and limit incoming/outgoing traffic to IoT devices.
• Develop Incident Plans: Have response strategies ready for IoT-related incidents like DDoS attacks, data breaches, and malware outbreaks.

Adopting a zero-trust approach is critical for limiting damage if an IoT device is compromised. This assumes breaches will occur and limits lateral movement after a breach. Multifactor authentication, network micro-segmentation, and other zero-trust strategies protect your most sensitive business assets and data.

The Future of IoT Security

While IoT devices present risks, the benefits they offer businesses in efficiency, automation, and insight should not be ignored. As security practices and awareness mature, IoT technology can be harnessed safely.

Industry groups are working to standardize security requirements for IoT devices across sectors. Manufacturers are being pressed to integrate security by design. And government regulations will likely expand to cover consumer and industrial IoT security.

Finally, new technologies like blockchain, edge computing, and AI-driven network monitoring will bolster the defenses of IoT environments. The companies that start building robust IoT security now will gain a competitive advantage as IoT adoption continues to accelerate in the years ahead.

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KSA partners Coalition offers a free cyber risk assessment, providing an overview of your risks and vulnerabilities. In addition to highlighting your vulnerabilities, the assessment includes a summary of recommended actions to help you mitigate your risk. Coalition also offers access to trained cybersecurity experts who can answer any questions you may have about the assessment or the recommendations you are provided.

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Protect Your Business

Cyber insurance provides every organization with crucial protection. It’s time to defend against cyberattacks for both you and your clients. Our team at KSA Insurance has years of experience and the know-how to help you create a policy that meets your needs by explaining your coverage alternatives.

Every company has different cyberthreats and weaknesses. You, therefore, need insurance that is customized just for you. You can focus on what you do best—growing your business—by leaving the protection to us. When you’re prepared, get a free quote from us right now!