For Texas executives, cyber risk is no longer an IT‑only issue, it’s an operational and financial exposure with local proof points. In 2024, Texans reported $1.35B in cybercrime losses to the FBI’s In...
Fraud & Cyber Security
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4 min read
For Texas executives, cyber risk is no longer an IT‑only issue, it’s an operational and financial exposure with local proof points. In 2024, Texans reported $1.35B in cybercrime losses to the FBI’s Internet Crime Complaint Center, with Texas ranking #2 in the nation for complaints; business email compromise (BEC) alone accounted for $293.5M in reported losses. San Antonio’s own CentroMed disclosed two major incidents in the past two years, the latest affecting 400,000 patients, illustrating how a single breach can ripple through operations, finance, and community trust.
Below is our consultative, data-driven outlook on the 2026 threat landscape and the proactive insurance and control measures leaders can begin implementing now.
The 2026 threat picture: what’s changing
Ransomware “3‑in‑1” extortion
Groups increasingly blend data theft, encryption, and DDoS to compound pressure—trends that intensified through 2024–2025 and are expected to persist.
AI‑enabled BEC and vendor invoice fraud
Email remains the most exploited vector by volume and dollars. BEC drove $2.77–$2.8B in U.S. losses in 2024, and cumulative losses reached nearly $8.5B over 2022–2024. Expect voice/video deepfakes to further erode approval workflows in the new year.
Third‑party and cloud concentration risk
2024 saw an 18% rise in critical cloud outages, with North America bearing roughly 60% of downtime hours.
Evolving regulatory exposure in Texas
The Texas Data Privacy and Security Act (TDPSA) took effect July 1, 2024 (with universal opt‑out Jan 1, 2025), expanding duties around data handling and consumer rights and elevating enforcement via the Attorney General’s privacy task force.
Where coverage gaps bite mid‑market companies
Business interruption (BI) and waiting periods
Downtime, not just data loss, is often the biggest driver of impact, especially in manufacturing and service industries. Review BI and contingent BI terms for cyber‑triggered outages (including "system failure", not just “security failure”), and confirm waiting periods align with today’s outage realities.
Social engineering/BEC
Many policies exclude or narrowly define coverage for fraudulent instruction or invoice manipulation. Given BEC’s loss severity, ensure your Business Cyber Insurance program carries dedicated social engineering limits and modern definitions that address deepfake‑assisted attacks.
Bricking and data restoration
Hardware replacement after malware (“bricking”) and full data re‑creation can be underfunded; check these conditions carefully against your asset base.
Incident response panel limits
Sufficient access to breach coaches, forensics, legal, and PR makes the difference between a week‑long hiccup and a quarter‑long disruption.
Insurance and security: a “both/and” strategy
Cyber insurance acts as a financial backup, not a substitute for strong IT security. Today’s insurers expect businesses to have essential protections in place, like multi-factor authentication (MFA), endpoint detection and response (EDR), secure backups, advanced email filtering, vendor risk controls, and a tested incident response plan. Having these measures in place, and being able to show them, can help lower your insurance costs and improve your coverage options in a competitive market.
Pair risk transfer with three practical moves for 2026 readiness:
Payment authentication overhaul
Strengthen how your business verifies payments and banking changes. Use out-of-band methods—like confirming requests through a separate channel—and always call back vendors using a verified number. Set up dual-approval rules for wire transfers to reduce the risk of fraud, especially as deepfake scams become more convincing.
Tabletop for cloud and vendor failure
Run practice scenarios to prepare for two types of outages: one caused by a ransomware attack on your IT provider, and another from a non-malicious cloud service failure. Map out which systems and vendors your operations depend on, and make sure your cyber liability insurance includes coverage for business interruptions caused by both types of events.
Texas privacy compliance tune-up
Review your privacy practices to ensure they align with the TDPSA. This includes updating consumer notices, managing data access requests, reviewing contracts with service providers, and completing internal data protection assessments—especially if your business handles large volumes of personal data.
What Central Texas leaders should do next
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Benchmark your current program against peers on limits, retentions, and coverage for social engineering, system‑failure BI, dependent BI, cyber crime, media, and privacy risks.
- Stress‑test downtime assumptions. Validate BI limits against a realistic outage: average ransomware recovery cost and encryption rates rose in 2024, and manufacturing downtime alone can exceed $1.9M/day in extreme cases.
- Harden approvals and identity. Treat executive requests for urgent payments or data as potential BEC until verified and monitor for deepfake risks in finance workflows.
How SWBC Insurance Services helps
With 45+ years protecting businesses and deep local knowledge of Central Texas, SWBC Insurance Services pairs brokerage expertise with incident‑readiness guidance. We help market leaders evaluate their Cyber Liability Insurance and Business Cyber Insurance programs, identify coverage gaps, align controls with underwriting expectations, and prepare for the evolving 2026 landscape.
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