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You may not realize it, but restaurants have become a hotbed for potential cyber threats. With the increased use of technology for operations, restaurants are constantly exposed to a ton of cyber vulnerabilities. Your restaurant probably handles more personal data than you know, and your restaurant insurance may not include cyber coverage. You definitely need a solid understanding of how cyber liability insurance can come into play. It’s a protective measure often overlooked by owners. Let’s cover more than a few reasons why restaurants need cyber insurance.

The Prevalence of Digital Technology in Restaurants

In the past few years, the restaurant industry has seen a substantial rise in dependence on tech. The COVID-19 pandemic amplified the need for technological adoption as restaurants were forced to pivot their operations to maintain survival and growth.

Restaurants now heavily rely on digital platforms for order placing and payments, embracing QR code menus and providing Wi-Fi access to customers. Although necessary for survival, these digital adoptions have left many restaurants more susceptible to cyber threats.

Technology implementation has extended beyond basic operations, influencing the entire customer experience. From making reservations to placing orders and processing payments, every step of the customer journey is now digitized, increasing the volume of personal data restaurants handle.

The Rise in Cyber Threats

As restaurants continue digitizing their operations, they become increasingly attractive targets for cybercriminals. The high volume of transactions and the storage of personally identifiable information make restaurants a goldmine for hackers.

The potential consequences of a restaurant cyberattack extend beyond financial damage. It also causes significant harm to a restaurant’s reputation, which can take years to rebuild. The fear of potential fraud has led to increased concern among consumers, with 62% expressing worries about sharing their information with restaurants.

Common Types of Cyber Threats Targeting Restaurants

Cyber threats have morphed in response to changing business vulnerabilities. The most prevalent types of attacks that restaurants should be aware of include:


Malware is any type of malicious software designed to infiltrate and damage a system. Cybercriminals commonly use phishing tactics to trick unsuspecting victims into clicking harmful links, granting them access to valuable data.


Ransomware attacks have seen a 13% increase recently. In these attacks, cybercriminals access data and demand a ransom for recovery. Despite being the least impacted sector, restaurants were found to be the most likely to comply with ransom demands.

Keylogging Software

Keylogging involves tracking every action performed on a computer, which allows hackers to access passwords and sensitive financial information.

Card Testing

Card testing occurs when hackers gain access to credit card details and test their viability by making small purchases. Although these charges may seem insignificant, they can quickly accumulate, leading to substantial financial losses.

The Role of Employees in Cybersecurity

While the digital frontier poses a significant risk, it is also essential to consider the human element in cybersecurity. Employees can inadvertently contribute to data breaches by opening suspicious emails or sharing passwords. In fact, 82% of data breaches involve a human component, emphasizing the need for comprehensive cybersecurity training for all staff.

The Need for Cyber Liability Insurance

Given the high stakes, restaurants must protect themselves from potential cyber threats. This is where cyber liability insurance comes into play. Contrary to popular belief, general liability insurance policies do not provide coverage for cyber attacks. Restaurant owners should invest in comprehensive cyber liability insurance to safeguard their operations.

Common Misconceptions about Cyber Liability Insurance

There are several misconceptions about cyber liability insurance, which often lead to costly mistakes.

Misplaced Trust in Third-Party Vendors

Many restaurant owners mistakenly believe that the protections provided by their third-party vendors extend to their operations. However, it remains the responsibility of the restaurant to protect the sensitive customer and employee data that passes through their systems.

Overreliance on IT Teams

While IT teams are crucial in maintaining system security, they cannot guarantee complete protection against cyber threats. Unintentional errors made by employees or the actions of disgruntled employees can lead to data breaches.

Misguided Views on Cost

The cost of restaurant cyber liability insurance varies based on several factors. However, it’s a negligible investment compared to the potential financial and reputational damages a cyber attack can inflict on a restaurant.

How Restaurants Can Protect Themselves from Cyber Attacks

The first step towards protection against cyber threats is ensuring that all online systems are secure. This involves the timely installation of software updates and security patches designed to address potential vulnerabilities.

Training employees on best security practices and how to identify threats is another crucial measure. Regular password changes and close email and social media account monitoring can also help prevent cyber attacks.

Regarding card testing, restaurants should ensure their payment gateway providers have installed velocity controls on their eCommerce sites. This limits the number of transactions accepted from a single IP address, preventing hackers from testing multiple cards simultaneously.

Preparation for Potential Cyber Attacks

Despite all preventive measures, there is always a chance of falling victim to a cyber attack. Therefore, having a response plan in place is critical. A good response plan should enable immediate notification of potential data breaches, customer protection, and proper investigation to prevent future occurrences.

Cyber liability is not just an important aspect of restaurant insurance, but a crucial part of any restaurant’s risk management strategy. Understand the risks involved and take appropriate preventive measures to ensure your business remains secure in the digital age.

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Cyber liability insurance for small business is more and more crucial. From mom-and-pop shops to big corporations, nearly every business now collects customers’ personal data and is vulnerable to cybersecurity threats.
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Restaurant Insurance

Restaurant insurance is a set of policies designed to protect your business in case of property damage, bodily injury, customer illness, and more. Learn more and get an easy quote.