According to the Privacy Rights Clearinghouse, U.S. businesses of all types suffered 2,372 breaches since 2005, compromising more than 515 million data records, including those containing customers’ private information and companies’ financials.*
Data can be compromised in a variety of ways, so businesses must understand the release of private information can have consequences. With the loss of data, there can be financial costs associated with locating and fixing the online infringement.
In 46 states, law mandates that businesses must contact customers whose information has been breached by some kind of cyber exposure. The ensuing aftermath could affect a business’ reputation or could potentially alter the business practice.
When consumers and business owners give credit card information and other personal data to a business or organization, the expectation is that the information will stay secure. If it doesn’t, there remains a potential for law suits and out-of-court settlements.
In this modern business landscape, where technology continues to change the way we do business, there are necessary steps which must be taken. Cyber Liability Insurance will allow businesses to prepare for online risk.
Nearly 30 insurance companies currently offer cyber liability policies, most of which Gunn-Mowery representatives have access to and can write coverage for. In an area of concern such as this, where information is paramount, Gunn-Mowery is here to help determine what types of policies might fit your company’s needs.
To prevent or reduce losses, businesses should:
• Implement a strong network of security systems, and continually monitor and update them as needed.
• Develop plans for responding to any network intrusion. A sound plan identifies who should be involved in the response and has procedures for notifying affected customers and authorities. It also will have a public relations strategy for the affected public in the aftermath of the breach.
Cyber Liability can affect almost anyone in the modern business landscape. Below are just a few examples over the last few years:
1. In April of 2011, the Sony Playstation Network was hacked. The intruders navigated into the video gaming network’s password-reset system and penetrated the security protecting its customer database. Days later, the company admitted the hackers had obtained personal information on 70 million or more subscribers. The intruders identified names, email addresses, birthdates, and other information, some of which was financial. Sony took the network offline to reinforce the system, but within days of it coming back online it was broken into again.
2. Over a seven-year period, a Georgia man stole 675,000 credit card numbers and associating information. He racked up thousands of fraudulent transactions and bills exceeding $36 million.
3. A Texas man received a 110-month prison sentence for hacking into 14 computers in the hospital where he worked as a security guard. He disabled network security systems, installed malicious software, infiltrated a nursing station computer containing patient medical records, and gained remote access to temperature-control systems.
4. The FBI caught a North Carolina man in the act of attempting to access an ATM in 2010. The man had planned to hack into 35 ATM’s located around Houston, Texas in the hopes of pocketing more than $200,000.
The majority of businesses and organizations operating today are vulnerable to unauthorized intrusions into their computer networks. The potential costs are more than most organizations can fund on their own. Cyber liability insurance is a smart investment that can literally save a company.
Is your business appropriately covered by cyber exposures? Contact Gunn-Mowery today at (800) 840-1243 or e-mail us at email@example.com to learn more Cyber Liability Coverage. Become our Facebook fan at Facebook.com/GunnMowery. And to become a subscriber to our newsletter, click here.