Data Breaches - What to Know
What are Data Breaches and how do they Happen?
The majority of companies, small and large alike, store personal information about their clients, employees, and vendors. Information like:
Credit card and banking information
Employee driver’s license numbers and Social Security numbers
Client names, phone numbers, and email addresses
This information is valuable to hackers. They can hold it from the company as ransom or sell it on the black market, leading to big trouble like identity theft for those whose information is leaked. This can also greatly ruin a company’s reputation. It’s true thieves can get more money by breaching large corporations, but small businesses are usually easier to hack because of having fewer walls of security. In 2020 it took, on average, 280 days to identify and contain a security breach. And according to Varonis Systems, a data security company, the average data breach at small businesses cost $179,000 in recovery expenses. Businesses that are not ready to deal with such a financial loss could be forced to shut down.
Below are a few common types of business data breaches:
Destructive and ransomware attacks are when someone destroys valuable records or holds them for ransom.
Malicious attacks can happen when there are gaps in protection in third-party softwares, the cloud, or simply by having weak passwords.
Nation-state attacks happen when threats work with a government to commit crimes against the U.S.. These are less common but can be the most costly.
How to Prevent a Data Breach
Evaluate your current security procedures. Review the safety measures you have in place when it comes to your data and cloud and ensure they are the best they can be. Ensure your softwares and devices are all up to date to keep effective security features. Use tools such as firewalls and reputable antivirus softwares to protect sensitive data. Limit access to employees and use extra layers of protections such as multi-factor authentication or single sign-ons.
Review common hacker tricks.
Hacking passwords. Many times, hackers get into an account the old fashioned way, using a password. Employees might write it down somewhere and leave it in plain for someone to grab, or just use a password that can be easily guessed like “password”. To prevent this, employees should use complex passwords and change them regularly. They should also make sure to never write them down where others can find it.
Phishing. When a hacker phishes, he sends an email that looks like it’s coming from a trusted sender. If the recipient clicks the link in the email or downloads the attachment, a virus is downloaded and gives the hacker full or partial access to important data. To prevent this, train employees on recognizing legitimate vs illegitimate emails. Get into the habit of hovering over a link to see the destination URL to help examine its source.
Ransomware. This is a type of malware that overrides a computer and blocks the user’s access to it. The hacker then demands a ransom in exchange for giving back access. This is spread through phishing emails or hackers taking advantage of vulnerabilities in security systems.
Get added protection.
Use a cloud access security broker (CASB). These softwares offer continuous monitoring and security for all cloud storage. It uses machine learning and user behavior to identify unauthorized users and events. You then have the option to quickly respond, preventing hackers from gaining access to sensitive data.
Hire an IT consultant. These professionals can examine the business’s set up and help keep the network safe.
Set up firewalls and restrict which websites employees can visit. This reduces the chances of someone accidentally visiting potentially dangerous sites with viruses.
Update computer systems as soon as they’re released. This ensures you have your operating systems’ most recent security features.
Limit the number of places where data is stored and encrypt data when it’s being transmitted.
Install reputable antivirus softwares that can prevent hackers from accessing sensitive data.
What to do if You’ve had a Data Breach
Report the security breach to law enforcement, and if mandated by state law, also inform consumer protection agencies.
Notify affected individuals about the breach, adhering to your state's guidelines. This can involve contacting them through email, phone, or regular mail.
Publish an announcement on your website regarding the data breach and provide information on how customers can reach out with inquiries.
Initiate an inquiry into the breach, which should encompass gathering details on when and where it transpired and identifying the compromised data. Business owners may consider engaging a professional security consultant for this task.
Address any security vulnerabilities that led to the breach. Simultaneously, maintain comprehensive records and evidence of the incident, as they might be required by law enforcement agencies.
Enlist the services of a credit monitoring company to offer fraud and identity theft prevention services to your customers.
Cybersecurity Insurance can Help Businesses Recover from a Breach
When a company falls victim to a data breach, expenses can swiftly accumulate. Cyber insurance serves as a safeguard, aiding businesses in weathering the financial aftermath of a cyberattack by covering recovery expenses such as customer notifications, credit monitoring, legal fees, and fines.
Cyber liability insurance comprises two categories: first party and third party. First-party insurance is designed for businesses that suffer data theft due to hacking and is typically available as a standalone policy or as an extension to a business owner's policy.
First-party cyber insurance, also referred to as data breach insurance, can cover costs associated with a breach, including:
Legal and forensic services
Notifying affected parties about the breach
Providing customer credit and fraud monitoring services
Crisis management services aimed at restoring the company's reputation
Addressing cyber extortion or ransomware-related expenses
Third-party coverage, on the other hand, shields businesses responsible for safeguarding another business's data, such as IT consulting firms. In cases where a customer files a lawsuit against an IT company, alleging that their actions (or lack thereof) contributed to a data breach, third-party cyber insurance can handle legal costs.
To gain a better understanding of cyber liability insurance and determine whether your business could benefit from either or both types of coverage, reach out to an agent at Centro Hispano!
