Kids' toys as you remember them are not what they are today. Smart technology hasn't only caught the attention of the adult consumer, but it's caught the eye of children too; your little consumers in the making.

Launched in 2014 and developed by Genesis Toys, the children's toy My Friend Cayla, when connected to the internet via Bluetooth, can answer your child's questions, (including how to bake a cake) play games and recognize visual images. An interactive toy, My Friend Cayla won the Product Innovation of the Year Award from Argos in 2015.

Despite its appeal, the doll has come up against strong opposition. In early December 2016, a coalition of international consumer watchdog groups filed a complaint against the doll with the Federal Trade Commission, arguing that the doll's technology could be used to spy on children. The speech-recognition software in the doll records the child's conversations. As reported by CNN, opposition groups "allege[d] that [Genesis Toys] upload[s] the recordings to Nuance Communications, a voice technology company that has military, law enforcement and intelligence agencies as clients." The watchdog groups purport that this technology is being used without the child's guardians' permission and is possibly violating children's privacy laws.

Friend or Foe?
In February, German authorities banned My Friend Cayla from being sold in the country believing the toy's smart technology could be hacked and personal information used for extortion or other nefarious dealings.

After banning the toy, Germany's Federal Network Agency advised parents who already had the toy in their home to destroy it. Jochen Homann, the head of the Federal Network Agency, believed after reviewing the findings of researcher Stefan Hessel that the doll "carried a risk of espionage and could compromise privacy." Hessel, the researcher who had alerted the agency of his findings said that cybercriminals could hack into the doll through its unsecured Bluetooth technology. \"In a test, [Hessel] was able to hack the toy even through several walls. It lacks any security features.\"

Vulnerabilities of Smart Technology
The public uses interconnected smart devices regularly, and advancements in the field of smart technology have brought this into work spaces and the family home. With "bring your own device" policies becoming more popular in the office and more employees working remotely, cybercriminals have more opportunity to hack into a server system and download, steal and shut down the company's network.

Having a cybersecurity action plan in place would bolster the protection of your small business, especially when partnered with cyber risk insurance coverage. While a small business coverage plan covers the day-to-day operations of your business, cyber risk insurance specifically covers your business when you have been hit by a cyberattack and need to pay for the cost of damages. Cybercriminals can hold your organization's information for ransom and your employees and customers' identities hostage; cyber insurance will pay for the safe return of the company data and for the replacement of equipment. If a customer should take you to court for not protecting their personal information, cyber insurance will cover the costs of litigation too.

As evidenced by the Cayla doll, hackers will target every vulnerability. Protect your business with cyber insurance from CyberPolicy today.