Not to start our very first post with such a heavy question, but it's one that each and every company, organization, entity, municipality, etc. must consider.
In a world of hackers, spammers, phishers, and human error, absolutely no one is immune to the liabilities that result from living in an interconnected world of technology. As we utilize technology more and more, the ability to acquire and access information grows. Of great concern is sensitive Personally Identifiable Information (PII), which includes names & addresses, Social Security Numbers, credit card numbers, etc.
When an organization who has PII suffers a data breach, they are liable in myriad forms and legally obligated to notify all affected persons their identities may be compromised.
Are there enough data breaches that we should be concerned?
The Open Source Foundation has compiled a website to track all known data breaches. Visit their DataBreach Database website.
Last year alone, they recorded 1,029 various data breaches! (And those are just the ones we know about.)
If we suffered a data breach, would it be expensive?
The statistics vary, but all conclude that is is not cheap to suffer a data breach. The most widely cited statistic is the Ponemon Institute's study on data breach costs, which states it will cost a company a little over $200 per breached record! Certainly not chump change.
Another handy tool is this Data Breach Calculator which lets organizations input the number of records they have on file and it computes a total cost for a data breach. (Note: this calculator relies on data which is a few years old, so one should add at least 10% to the amounts given.)
So, are you ready--logistically and financially-- to respond to a massive data breach?
There is good news and a light at the end of the tunnel. Cyber liability insurance is specifically designed to help an organization respond to a breach of sensitive PII. Once a cyber liability policy is in force, the insured has immediate access to data breach experts, specialized privacy attorneys, and pools of money to pay for the huge costs you will face. (See our Claims Scenario page.)
The insurance coverages a cyber liability policy provides are typically and specifically excluded in commercial General Liability, so without this unique coverage, an organization faces a dangerous coverage gap.
We're cyber liability insurance experts, specializing in finding top-notch coverage for any organization. If you have any questions, thoughts or concerns, please give us a ring. Call me, Nickel Lietzau, directly at 410-727-2211 x606.