60% of Cyber Attacks & Data Breaches are on Small Business
by Dan Walker, GHB Commercial Department
Cyber Attacks and Data Breaches are a scary subject for any business. At GHB, we know there is a fine line between informing people and just, plain scare tactics, but we want to be sure owners know the real risks their businesses face today.
Experts tell me that that 60% of these attacks target small to mediums-sized businesses. The thought is that smaller companies are easy targets due to lack of security and as you are well aware, most small business owners are so busy running a business, they do not have the ability to keep an eye on these types of issues. Nearly 60% of small businesses end up closing their doors within six months of a cyber attack. Small business profit margins are so small, that the staggering cost to a company to inform and protect their clients puts them out of business.
Here is why.
Forty-seven states, including the state of Washington, require that if a company is affected, it must contact each and every client, vendor, or anyone whose records could be affected by the breach. Breaches, by the way, include both electronic files and hard copy files.
In addition to the time and expense of contacting every single person whose records may have been stolen, the business will also end up paying for identity theft monitoring, legal defense, re-instilling confidence through public relations efforts, and more. I have seen reports listing costs of $175 to $275 per client by the time you have cleaned up entirely after the breach.
Though business owners hear about these breaches and attacks almost every day now on the news, most seem to think it will never happen to them and it is sometimes hard to get through to them about the risks. It has become such a threat that one of the commercial business insurance carriers we work with is adding this coverage to every renewal quote.
Complacency does not pay
Any company that collects client information—whether it is Social Security numbers, credit card numbers, health records, or driver’s license numbers—are susceptible to Cyber and Data Breach attacks.
Cyber liability insurance is somewhat new but is more and more necessary as today’s risks escalate rapidly. Ignoring those risks often results in lost revenue, costly mitigation and potential liability.
I can help you understand how to protect your business, your records and your clients with adequate insurance coverage for cyber liability.
You can contact me at [email protected] or at (360) 943-4500 or toll-free at (800)789-5011.