As your company becomes increasingly dependent upon the Internet you face a new class of threats to your balance sheet and income statement. These loss potentials are unlikely to be covered by traditional insurance. For detailed information on potential losses, please see our types of losses page.
The most common threats are as follows:
1.Activities by a hacker to a third party whom alleges damages, including:
a. Accesses your computer to send a virus.
b. Accesses your computer system to release sensitive customer data.
c. Launches an attack that shuts down your computer system.
d. Accesses your network and launches an attack.
e. Accesses your network and transfers money or credit card information you are holding.
2. Activities by a hacker to first party whom alleges damages, including:
a. Deletes data or alters your data and you incur costs to reproduce the data and lost income.
b. Sends a virus to your system and you suffer damages to data and lost income.
c. Gains access to your network and causes an electronic transfer of your funds to his/her account.
d. Extorts money by threatening to divulge sensitive data he/she collected over your network.
e. Changes all of your passwords and locks you out of your network.
f. Launches a Denial of Service (DOS) attack which makes it impossible to sell products over your website.
3. If you have a website, a third party may allege that you have published their copyrighted material.
4. If you are a financial institution or deal with patient records, you could have significant defense costs associated with an administrative action under GLB or HIPAA regulations
5. If you sell internet access services to a third party and they allege they were denied access.
6. If you sell software to a third party that alleges damages as a result of software malfunction.
7. If you have employees – you have risk! Most likely you pay them via EFT. That means you are storing their personal identifiable information and their bank access information.
8. If you have a product that you sell and collect shipping, credit card or billable information either on line or within your own in-house system, you also have that exposure.
What is data breach? According to GAO, “data breach generally refers to an organization’s unauthorized or unintentional exposure, disclosure, or loss of sensitive personal information, which can include personally identifiable information (PII) such as Social Security numbers (SSN) or financial information such as credit card numbers”
Today, more and more businesses are storing and electronically sending sensitive data about their customers and employees. In addition, there are more and more regulations requiring businesses to advise customers and employees if personal information has been revealed. That makes data breach a serious issue for small businesses, where the majority of breaches have been reported.
Data breach can occur as simply as an employee losing a laptop. Depending on the amount of PII on the laptop, a small accident can cost a business more than $20,000 in data breach alone. In April 2012, Zappos Corporation announced that personal information for close to 24 million customers might have been compromised by a hacker. Imagine the cost of the same breach to a small business!
Have you thought about transferring all of this risk to an insurance product that can cover you in case of a data breach? Cyber Liability insurance can also help you pick up the pieces and restore confidence after the incident.