What is a data breach? A data breach is the potential for electronic equipment to fail and for sensitive data to be stolen and/or leaked, resulting in expensive cleanup tactics. Data breaches come in many forms, often resulting in the liability of your business to take care of such threats. Here are some examples that your business might face:
- A new installation corrupts your customer database
- A hacker steals and leaks secret strategies or customer credit card information
- Sensitive files are found in a dumpster after not being properly disposed of
- An employee accidentally leaves a work laptop in a public place and it’s stolen
Remember the Target scandal last year where 40 million customers became at risk for identity theft following a data breach? Though not all breaches are at that large of a scale, many of these instances can result in damage control efforts and lawsuits that can easily add up to exceed six figures. While this may only put a chink in the armor of larger businesses, it could be devastating for smaller businesses.
Even with firewalls and anti-viral software, over a third of all businesses experienced some sort of data breach last year. In order to protect your livelihood, it’s best that you do two things. First, have IT professionals equip your business with server protection and firewalls that meet industry-standard security best practices. Second, purchase data breach insurance to protect yourself for potential losses.
Data Breach insurance should be considered by any business that retains sensitive information and electronic equipment. These businesses include online retailers and marketers, financial institutions, technology companies, law firms, healthcare professionals, schools/universities, etc. This coverage offers protection from the expenses associated with being held liable for both internal and external data breaches, which can cost your business financially, ruin your business’ reputation and scare off previously loyal customers. What exactly are the costs associated with a data breach? Depending on the circumstances of the breach, you may be responsible for paying for the following:
- Containment and patching the source of the breach
- Customer notification
- Replacement of lost/corrupted data or equipment
- PR and crisis management
- Business interruption
- Fines associated with cyber terrorism, extortion and libel/slander
- Legal fees for defense
The small cost of data breach insurance is justified by the amount of protection it offers, which can be the difference between bouncing back and closing business doors permanently. Call us at (941) 745-8300 to find out more about this coverage and if it is right for you!