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Hacking isn’t only something that happens in your favorite crime drama, there are hundreds of thousands of cyber attacks every day. Typically, phones, computers, and online accounts are the target for these digital criminals, but could a car also become a target?
As vehicles become smarter, more connected, and more software-driven, the risks to collision repair shops are no longer just physical, they’re also digital.
In a recent episode of the ADAS Empowered Podcast, host Joel Adcock sat down with Nick Melon of RRM Insurance to discuss the evolving landscape of risk in collision repair, including the rapidly growing and often overlooked threat of cybersecurity.
Connected Cars, Smart Shops, Real Risk
Modern vehicles, especially EVs and ADAS-equipped models, are increasingly connected to the internet, your shop’s Wi-Fi, and cloud-based diagnostic tools. This connectivity introduces new risks that most shops aren’t prepared to defend.
While this may seem far-fetched, Nick shared a hypothetical scenario that feels more realistic by the day.
“Is there a world where [a hacker] can disable the vehicle and charge a ransom?” he asked, before affirming yes, “they do that with software all the time.” This example may open your eyes to a probable and daunting future in which you need to be prepared for cybersecurity threats in your collision shop.
Imagine a scenario where a Tesla comes in for a simple ADAS calibration. You connect it to your shop’s Wi-Fi. While the vehicle remains connected overnight, someone breaches your network. This breach has created a path for the hacker to access the Tesla, exposing customer data and potentially allowing malicious software to interfere with vehicle systems.
According to Upstream, an Ann Arbor-based cybersecurity firm, found that cyber attacks on the automotive industry soared from 5% to 19% of overall cyber attacks between 2023 and 2024. Hackers are targeting this industry as smart system integration is increasing, while security is not keeping pace.
Most Shops Aren’t Prepared
When asked how often he sees shops with proper cybersecurity protocols in place, Nick didn’t mince words. He urges shops to increase security and have a protocol in place for dealing with potential cyber threats.
He mentioned, “A lot of shops have some version of a firewall, sure… but do they have an actual cybersecurity protocol? A written practice that they review with their team? That’s a lot more rare.” This is alarming for a few reasons, namely that most smart vehicles are not protected against cybersecurity threats when in collision shops.
At best, many shops are relying on their software vendors’ security. The shops themselves, however, haven’t documented any internal cybersecurity standards, training, or response protocols.
As if this weren’t already concerning enough, most general liability business insurance policies exclude cyber-related incidents altogether. This can leave you to foot the bill in a scenario where your shop is the target of a cyber attack. This scenario can be frustrating as it seems as though a general liability policy would protect you from these types of losses, but this is not the case.
“Cyber liability is one of the fastest-growing claims areas, typically excluded on your general liability policy,” Nick explains, “If you didn’t cause bodily injury or property damage to a third party, it’s probably not covered.”
This glaring hole in your coverage is not some scam from your insurance company. This is still a fairly new risk that traditional, one-size-fits-all insurance policies aren’t going to fix. Nick goes on to explain that insurance needs to be specialized and exact to ensure your shop is covered in the case of cyber threats.
Cyber Liability Coverage: Low Cost, High Protection
Well then, what is the good news?
Adding cyber protection doesn’t have to break the bank. When asked about the cost of specific insurance packages that are typically omitted by those classic one-size-fits-all plans, many options can fit your budget.
Nick explained that, “In the grand scheme of a client’s package… the cyber, EPLI, errors & omissions, they’re all very inexpensive,” he continues, “We wouldn’t be doing our job as agents if we didn’t present them.”
In many cases, you can add basic cyber liability coverage for a few hundred dollars a year. That small investment could protect your business from massive legal fees, lost data, or even ransomware attacks.
Best Practices to Implement Now
Nick recommends a two-pronged approach:
- Prevent the risk with best practices:
- Use two-factor authentication
- Back up data regularly
- Train employees to spot phishing attempts
- Add a cybersecurity section to your employee handbook
- Use two-factor authentication
- Transfer the risk with the right insurance:
- Get a cyber liability quote tailored to your shop
- Review existing exclusions in your general liability policy
- Work with an agency that understands collision repair
- Get a cyber liability quote tailored to your shop
Nick concluded his discussion on cybersecurity with: “The world isn’t perfect, but doing something, even a short reminder in your safety meetings, makes a difference.” Making small changes to your cybersecurity approach can have drastic impacts on your safety, your customers’ safety, and your protection against liability issues.
Don’t Wait for the Worst-Case Scenario
Cyber threats are no longer a "big business" problem, they're every shop’s problem. If your shop handles connected vehicles, stores customer data, or uses Wi-Fi-enabled diagnostics, you're exposed.
Start small: ask your agent if you’re covered, document your first few policies, and train your team on red flags.
And if your agent gives you a blank stare when you mention ADAS or cybersecurity?
“That’s maybe an indication you need someone more specialized,” Nick said.
Listen to the full episode of ADAS Empowered Podcast featuring Nick Melon wherever you get your podcasts or click the link here: https://podcast.revvhq.com/
