20 Sep Tips and Techniques: The Growing Threat of a Data Breach to Small to Mid-Sized Businesses
Did you know that 90% of all data breaches affect small businesses? Starkweather & Shepley Account Executive Jay M. Frechette digs deeper into the topic and includes tips on precautionary measures you can take.
The saying goes, “It’s not IF you will have a data breach, it’s WHEN.” With the marine industry quickly becoming a more digital industry, information can be a valuable asset. Unfortunately this asset can also turn into a significant and costly liability if it falls into the wrong hands.
You have probably heard of some of the larger, high-profile attacks such as Sony, Target, Home Depot, or Chicago Yacht Club; but it’s not just Fortune 500 Companies that are being targeted. According to Trustwave research, 90% of all data breaches effect small businesses. This is due to lack of controls and low preparedness levels in these types of businesses.
There are five potential sources in which a data breach could occur:
- Theft by malicious third parties (Hackers)
- Virus threats
- Physical and administrative mishandling (employee mistakes)
- 1st Party “inside jobs” by a rogue employee
- Violation of Federal, State or Local Privacy Laws
Data breach response costs for small businesses average $36,000 – $50,000. This figure does not include costs that come from lawsuits, regulatory fines/penalties, or lost time and revenue due a damaged reputation.
Cyber Extortion (Ransomware) and Social Engineering (willfully wiring funds to what you think is a member of your organization, customer, or vendor) are two other rapidly increasing issues negatively effecting businesses.
Since most small businesses aren’t able to recover after security breaches, it is always a good option to keep precautionary measures ready against an attack. The following tips can help make sure you are prepared for attacks against your business.
- Work with an internal or 3rd party IT/network security company to ensure that the proper controls are in place.
- Purchase a Cyber Liability and Breach Response Insurance Policy
- These events are not covered by General Liability Policies
- These policies have become much broader in coverage and more affordable for small to mid-sized businesses
- Make sure your employees understand these threats and are trained as far as what to look for to avoid attacks.
–Article by Jay M. Frechette, Account Executive – Marine Risk Solutions, Starkweather & Shepley Insurance Brokerage, Inc. (401-435-3600 / firstname.lastname@example.org).
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