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Cyber Liability Insurance

ANY BUSINESS CAN BE AT RISK OF A DATA BREACH

 

Highly publicized data breaches at corporate giants like Home Depot and Target make it seem like cyber criminals are only interested in hacking big business. Actually, nothing could be further from the truth.Some experts cite small business as “low hanging fruit” that are easier for cyber criminals to target because they are less likely to have dedicated IT people on staff, have less formal IT policies (or potentially no policy at all), and because small businesses feel they couldn’t possibly be targets.

 

Here’s reality:

A 2013 Verizon Data Break Investigations Report cites that 31% of all data breaches occur in companies with fewer than 100 employees.

 

Even more concerning is the fact that 60% of small companies who have a data breach don’t survive the cyber attack.

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So no matter what the size of your company, shift your thinking to what your financial exposure would be if your records are hacked or held for ransom!

 

Managing a Data Breach is Expensive

 

Costs associated with a data breach are now estimated at $200 per compromised record. That would make the cost of a breach of 5000 client records $1 million! How many small businesses could survive that financial hit?

 

The expense is high because there are numerous fronts that must be addressed in any breach. They include:

 

Forensic Expenses: 

An investigation of what happened, how it happened, and what information was accessed.

Legal Expenses: 

Legal representation to determine the scope of federal and state notification requirements for data breaches. You will also need legal counsel to defend you in the event a suit is filed against you.

Notification Expenses: 

The expenses associated with notifying affected customers can include postage, paper, printing, call centers, and more.

Regulatory Fines and Penalties: 

These depend on the incident and your state.

Credit Monitoring and ID Theft Repair: 

While not legally required, it is generally agreed that offering these services to the affected parties will reduce potential legal liability (and is considered the right thing to do.)

Public Relations Expenses: 

Media crisis management could be critical to restoring your good reputation and maintaining your clients, business associates, partners, patients, and vendors.

 

In our interconnected world, the risk isn’t going away. In fact the forms and methods of data breaches are changing at accelerating rates. And if your company maintains private customer information —whether it is financial information, personally identifying information, or health information — your company can’t afford to ignore the threat. Plus every company connected to the Internet has to think about whether you’re unknowingly passing malware or viruses to your clients and customers by email – damaging their networked computer systems!

Cushman Insurance Group can help you identify your risks and arrange the best cyber package to protect your company’s future. Click here to email Ted Hughes for a confidential, no-obligation consultation.

 

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