Why Cyber Liability Insurance Is Critical for NC Manufacturers

Read time: 5 minutes / By SIA Group / Last Updated: Sept 2025 / Many NC manufacturers think cyberattacks won’t hit them. However, understanding the role of commercial insurance in North Carolina is crucial, especially considering why cyber liability insurance is critical for NC manufacturers. These businesses are actually prime targets. Learn why they’re prime targets, the real costs of downtime these attacks pose, and how the right cyber liability insurance plan can help respond when an attack occurs.

North Carolina woodworking factory workers processing lumber with industrial machines and practicing workplace safety

“It Won’t Happen to Us” — The Biggest Cyber Myth in Manufacturing

Many North Carolina manufacturers assume cyberattacks are only a threat to banks, hospitals, or big tech not to furniture makers preparing for High Point Market (HPMKT), textile plants or metal fabricators gearing up for a new ERP implementation, or a wood manufacturer accepting its next order. Why cyber liability insurance is critical for NC manufacturers is something some might overlook, thinking they’re too small to be targeted, while others trust their IT team has the needed protection in place. Yet, commercial insurance in North Carolina can be the safeguard they didn’t consider.

The truth is very different. Since 2018, U.S. manufacturers have faced more than 350 ransomware attacks, costing the industry billions. Attackers know manufacturers can’t afford downtime and are more likely to pay quickly to resume operations, emphasizing the importance of having commercial insurance in place for those based in North Carolina. Why cyber liability insurance is critical for NC manufacturers lies in this very vulnerability.

Empty warehouse in North Carolina with shelving and a forklift highlighted by sunlight

The Cost of Believing “It Won’t Happen”

Downtime is the most expensive consequence of a cyberattack:

$250,000 per hour in lost production on average
11.6 days of downtime is typical after ransomware attack
That’s $1.3 million per day across U.S. manufacturing
From 2018–2024, ransomware drained over $17 billion from the sector

But costs aren’t just financial:

Reputation Damage: A wood manufacturer missing shipments or a furniture fabricator disrupted before HPMKT risks losing contracts
Customer Confidence: Buyers question the safety of their designs, data, and orders
Employee Morale: Fear and frustration can slow productivity even after recovery

👉 The National Association of Manufacturers (NAM) warns that cyber incidents are now one of the sector’s greatest threats. This makes commercial insurance in North Carolina a necessity rather than a luxury and illustrates why cyber liability insurance is critical for NC manufacturers.

Why Hackers Target Manufacturers

If cybercriminals once favored banks, today they prefer manufacturers in part because of the vulnerabilities they associate specifically with sectors like those in North Carolina needing commercial insurance.

Here’s why:

Connected Systems: ERP, machines, and controls create many entry points
Supply Chain Pressure: Deadlines exploited to force ransom payments
Small and Mid-Sized Firms Are Vulnerable: Outdated systems, weak cybersecurity
Valuable Intellectual Property: Designs and processes targeted for theft or resale
False Security: “Too small to target” firms are prime victims

Printing press in a North Carolina manufacturing facility producing materials at high speed.

A Cybersecurity Playbook for NC Manufacturers

Cyber defense isn’t just about insurance, it’s about a layered strategy that combines people, processes, and technology. Steps include:

1. Risk Assessment & Planning – Identify weak points in IT and OT systems
2. Strengthen Security – Secure both business networks and factory-floor systems
3. Employee Training – Most breaches begin with phishing. Train staff to spot risks
4. Data Protection – Encrypt and back up critical information
5. Vendor & Supply Chain Management – Especially vital for suppliers tied to specific and unique networks
6. Cyber Liability Insurance – Transfer financial risk from lawsuits, downtime, and recovery costs

Digital cybersecurity overlay on North Carolina manufacturing equipment highlighting data and network protection.

How Insurance Protects NC Manufacturers from Cyber Threats

Even the best cybersecurity controls can fail. Cyber liability insurance acts as a financial backstop, covering:

Legal defense and settlements
Costs of ransomware recovery and data restoration
Business income replacement during downtime
Customer notification and regulatory compliance support

Many NC manufacturers avoid coverage because they underestimate risk or focus only on physical exposures like property and equipment. But understanding why cyber liability insurance is critical for NC manufacturers should not be overlooked. These coverages should be tailored to match the specific needs of each unique manufacturer. Understanding commercial insurance in North Carolina can make all the difference. A strong advisor ensures coverage aligns with business income and property policies to protect operations from both physical and digital threats.

For North Carolina manufacturers, (whether textiles, furniture, metal, or wood) the message is clear: ignoring cyber risk is no longer an option. To mitigate risks, employing commercial insurance policies in North Carolina, including cyber liability insurance, limits financial damage, reduces downtime, and protects supply chain relationships, keeping production running even when cybercriminals strike. This is precisely why cyber liability insurance is critical for NC manufacturers.