Central Insurance Blog

Manufacturing facilities have long focused on protecting workers and physical assets. But in today’s digital world, cyber threats can be just as dangerous as fires, machine malfunctions, or workplace injuries. 

In fact, cyberattacks are on the rise across industries, with cyber threats up nearly 50% worldwide and ransomware incidents increasing by 126%.

Manufacturers are increasingly becoming a prime target for these events, as cybercriminals know that manufacturers store sensitive data, depend on continuous operations, and often lack sophisticated IT defenses. That’s why, for many plants, the weakest link is not the machinery on the floor, but the networks running behind the scenes.

In the article below, Jim Lewis—a senior loss control consultant at Central Insurance—provides expert tips on how to prevent your manufacturing organization from cyber threats. Read on to uncover his seasoned advice, compiled through a long career of on-site loss control evaluations and cybersecurity prevention in manufacturing facilities.

Why Manufacturers Need Stronger Cybersecurity to Avoid Becoming Easy Targets

Unlike financial institutions or tech companies, many manufacturers did not build their operations with cybersecurity in mind. 

“Many manufacturers are just very ill-prepared for this,” Lewis explains. “Their processes can collect a lot of valuable information—from proprietary data to employee and vendor records—and they can be duped into sharing that information with bad actors. Many in the industry just aren’t sufficiently prepared for this threat, so they can become easy targets.”

This vulnerability is evident in the numbers: 80% of manufacturers reported a significant increase in security incidents or breaches last year, yet only 45% say they are adequately prepared to handle cyber threats.

Lewis highlights that small and mid-sized facilities are especially exposed. Many organizations lack a dedicated IT department, relying instead on a single employee with basic computer knowledge to “keep the system running.” 

Limited resources, specialized expertise, and budget constraints can make it difficult for these manufacturers to invest in the robust protections today’s environment demands.

The cost of inaction is climbing fast. The industrial sector is experiencing the steepest increase in data breach costs of any industry, rising by an average of $830,000 year-over-year. And when an attack succeeds, the consequences can be severe and long-lasting. Here, Lewis outlines some of the most impactful:

• Financial theft or fraud: This can include anything from stolen bank credentials to diverted payments.
• Operational disruption and downtime: Ransomware can halt production lines for days or weeks.
• Reputational damage: Customers may lose trust if sensitive data is compromised.
• Legal and regulatory costs: This includes investigations, litigation, and fines.
• Business interruption losses: Even brief outages can result in missed deadlines, sales and strained relationships.

For small and mid-sized manufacturers, he warns that just one major incident could jeopardize contracts, drain finances, and ultimately threaten the business’s survival.

Common Types of Manufacturing Cybersecurity Threats

Cyberattacks take many forms, but some of the most common threats to manufacturers include:

• Ransomware: Hackers encrypt critical files and demand payment to restore access
• Phishing: Employees are tricked into clicking malicious links or sharing login credentials
• Business email compromise (BEC): Criminals pose as trusted vendors or executives to divert payments
• Intellectual property theft: Thieves steal proprietary formulas, designs, or processes
• Insider threats: Current or former employees exploit access to data or systems

“Owners and executives are prime targets,” Lewis continues. “They have the most access and authority, which makes them especially valuable to hackers.”

Proactive Steps to Prevent Manufacturing Cyberattacks

The good news is that manufacturers can prevent most cyber incidents or minimize their damage through proactive planning and practical safeguards.

Below, Lewis outlines some key steps every manufacturer should consider following to minimize the risk of a cyberattack:

Step #1: Conduct a Risk Assessment

Start with a thorough review of your systems, networks, and data. Identify critical assets, potential vulnerabilities, and the business impact if they were compromised.

Step #2: Encrypt Sensitive Data

Protect data in transit and at rest. Encryption ensures that even if hackers steal files, they can’t easily access the information.

Step #3: Implement Multi-Factor Authentication (MFA)

Passwords alone are no longer enough. MFA requires two or more verification steps, making it more difficult for criminals to break in.

Step #4: Limit and Segregate Access

Don’t give every employee the “keys to the castle.” Limit system access to only what each user needs to perform their job. Segregate networks to keep sensitive information isolated and secure.

Step #5 Train Employees

“The first line of defense for manufacturers is education and awareness,” Lewis explains. Employee training, whether through short monthly online modules or periodic in-person sessions, helps staff recognize phishing emails, avoid unsafe downloads, and understand their role in protecting company data.

Step #6: 6. Ensure Adequate Insurance Coverage

Manufacturers face an 80% increase in security incidents, but only 45% feel adequately prepared. Without cyber insurance or proper coverage, recovery costs tied to breach response, downtime, or regulatory fines may fall entirely on the business.

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Manufacturing Cybersecurity Resources Available Through Central

Many manufacturers don’t know where to begin. A good first step is talking with your independent Central agent. Agents are often the first point of contact for coverage questions, guidance, and risk management advice.

Manufacturing companies that work with Central also gain access to helpful resources related to cyber coverage, including:

• Cyber Suite: a TransUnion partner program that provides comprehensive coverage with multiple layers of insurance defense against the complex, ever-evolving cyber risks businesses face
• Cybersecurity Today Webinar: A 14-minute training on best practices for employees
• Risk Management Bulletins: Covering topics like protecting computer systems and using Cyber Suite

Additionally, Central’s loss control consultants can work with manufacturers to evaluate their overall safety and loss prevention practices. If a facility appears less sophisticated, consultants can provide guidance and connect them with resources.

How Central Helps to Protect Manufacturers

Cybersecurity isn’t just an IT concern; it’s a critical part of risk management. For manufacturers, the stakes are even higher. Valuable data, interconnected supply chains, and limited internal resources make the industry especially vulnerable. Without proper preparation, even a single cyber incident can halt operations, damage a reputation, and threaten long-term stability.

With nearly 150 years of experience, Central understands the importance of protecting every part of your business. From commercial property coverage to specialized cyber risk resources like Cyber Suite, we provide tools and expertise to help you strengthen defenses and safeguard the future of your manufacturing enterprise.

Talk to your local independent Central agent today to learn how proactive cyber risk management and the right insurance coverage can help your business stay resilient in an increasingly digital world.