IoT Liability
The internet of things is taking over. Along with the distribution of IoT devices, their liabilities are bound to occur. This is because the world of IoT is diverse and we do not have much experience to control this technology in the best manner yet. In this article, we will discuss the liabilities of IoT devices in detail.
Introduction to IoT Liability
The liabilities of IoT devices, software, or hardware affect the shareholders of the company, the developers, the distributors, and even the users. There is no doubt that the IoT technology is different from the rest of the technologies and hence identifying a breach becomes more difficult. When there is communication between devices via a network, the system is prone to DSoS attacks which are harder to track with IoT devices.
What happens when intelligent devices go wrong?
Smart devices were created with the purpose of making human lives easier. This increases the dependency on devices and hence manufacturers must ensure the safety and responsibility of these devices. When smart devices do not work properly it could lead to serious and irreversible mishaps in any industry. For example, a smart car with default functionality could cause a road accident or lead to the fatal death of the driver.
Product Liability and how it applies to IoT
When a manufacturer creates products that could damage the lives of a consumer, the manufacturer is liable for creating harmful products and this is known as product liability. Sellers must be responsible enough for creating products that ensure the safety of the consumer or buyer. According to the law, a product should meet the basic and expected needs of the consumer. Defected products do not meet the required needs of a consumer.
Product liability laws state that the producer, the seller of parts, and the vendors are to be held responsible for selling damaged goods. The user may also be liable for misusing or mishandling the product. This notion may change for IoT devices. As of now, the future of the product liability for IoT devices is not clear.
There is no proper mechanism on who to hold responsible for security breaches, privacy issues and other damages. The question also arises on will the insurance cover costs of hacked devices or other damages from IoT devices.
What legal experts are saying about IoT Product Liability?
Experts believe that the kind of damage in digital terms may transform the product liability for IoT devices. For example, in cases of physical damages, the amount is easy to determine. However, in case of IoT hacks it becomes difficult to decide who to hold accountable for the leak. In addition, it becomes hard to calculate the loss amount.
Courts may ask IoT users to provide valid proof against third parties or IoT makers. Developers may be held directly accountable for liabilities even without any kind of solid proof.
Liability could also be distributed among different stakeholders, producers, suppliers, and other organizations.
Finally, depending on the kind of IoT attack various criminal and civil liabilities may be involved. For example, in case of a smart car crashing into another vehicle due to incompatible smart city traffic, criminal laws could be applicable.
IoT product liability crests challenge for IoT end-users and developers
As we see a growth in the IoT market, IoT product liability increasingly affects both the software developers and the end product users or the customers and consumers. The end users may be affected directly by damaged industrial IoT devices.
Review experts predict large uncertainty regarding product liability in IoT in the future. Courts and laws may introduce a lot of positions for IoT products liability. Software developers could be held directly responsible for any software breach or threat to security.
Let us look at some of the major IoT liabilities :
1. Device Malfunction
IoT allows us to have better control over our devices by their automation. We can monitor, track and maintain our devices remotely. IoT makes lives easiest by managing important structures, organizations, and personal assets on behalf of us.
Any system failure or device breakdown may result in serious injuries. For example, a remote monitoring device that records wrong blood pressure levels and sends over the details to the doctor could seriously damage the health of the patient without the doctor’s awareness of the actual recordings.
2. Data theft
IoT devices collect and store huge amounts of data incoming from the user. Large databases store personal and sensitive information about the user. Any breach in the network or the device could result in the exposure of private details to the outer world. It becomes worse when we are unable to identify the leak and this way billions of users and their data could be at risk.
Hackers use this information for a variety of illegal reasons such as identity theft, framing users for crimes, advertising, cyberstalking, and so on.
3. Cyberattacks
When devices are less secure cybercriminals and hackers can get easy access to sensitive information which they later use for manipulation and illegal activities. IoT devices expose the network to a number of criminal activities if not secured properly.
Given below are a few of the most effective methods to prevent cyber attacks:
a. Built-in security: Devices with inbuilt features for security are at lesser exposure to cyber attacks than those with less secure systems.
b. Encryption– manufacturers must ensure end-to-end encryption to allow safe communication between devices.
c. Risk analysis: There must be a proper system to calculate the risks of involving any functionality in iot devices and hardware.
d. Authorization: Hard to decode passwords prevent illegal access or login to private devices such as smart cars or smart homes.
Are IoT endpoints accurate?
IoT data is not enough to make precise decisions about the IoT endpoints. If a business makes decisions based on the accuracy of the data then the organization is liable to errors. This is because the data may or may not be factually correct and the accuracy of the data impacts the businesses heavily.
Impact of IoT liability
Any defective product impacts a chain of customers and organizations:
- Product manufacturers
- Producer of component parts
- Product assembling party
- Product installer
- Wholesalers and vendors selling the product
In addition, the devices and software that support IoT devices could be potentially responsible as well. This includes the software, the network chain, organizations that handle safety and security, and so on.
IoT liability issues are a work in progress
The companies that decide on implementing IoT devices must stay in contact with organizations to ensure that the abilities of IoT devices do not affect them directly. If the organizations feel the presence of bias in agreements then they should not buy the products from the suppliers and producers at all.
Summary
So this was about liabilities in IoT technology. We have seen how serious the issue is regarding product liability. We have seen expert point of view in the product liability in IoT devices and further, we looked at device malfunction, security threats and cyber-attacks.