cyber insurance for retailers
Target. Home Depot. Neiman Marcus. JC Penney. KMart. The list goes on. If you are a retailer- bricks and mortar or online- cyber insurance isn’t an option. It’s a necessity. There’s no escaping the fact that retailers are the #1 target for cyber thieves, so having a plan of defense in the event of an attack is the best way to mitigate damages. The unfortunate reality is there is no surefire way of protecting your customer’s data: hackers will always be one step ahead of security. Because of this disturbing truth, the narrative for online retailers has shifted from “will we be hacked?” to “when will we be hacked?” As a retailer, you are now forced with confronting the inevitable fact that in the event of a security breach you WILL experience losses and you WILL be responsible for any and all damages and expenses as a result of the fallout of a breach. Protection of assets is as important as protection of data, and thanks to cyber insurance protecting your bottom line is much simpler than shoring up your network.
Cyber insurance gives retailers the peace of mind knowing that in the event of the breach, they are covered for virtually all losses- both first and third party – in addition to credit monitoring for affected consumers. Loss of revenue due to business interruption, first party losses associated with finding/fixing/restoring the breach/data, losses associated with reissuing credit cards, breach notification costs, damages as a result of formal suits brought upon by customers, legal fees, cyber extortion fees, media/PR crisis communication costs, copyright infringement/misuse of website, and regulatory fines and penalties are all covered.
The average breach is estimated to cost retailers over $200 per record and the total average cost to a company is $5.85 Million. To calculate your exposure, multiply the number of customers you’ve served as far back as your records are electronically kept and that’s your potential loss in the event of a data breach. But it doesn’t stop there. The Ponemon Institute’s annual ” 2014 Cost of Data Breach” report says what affects retailers bottom line the most is the loss of customers in the aftermath of a breach and the advertising dollars spent to repair their trust.
*Notification costs typically include IT activities associated with the creation of contact databases, determination of all regulatory requirements, engagement ofoutside experts, postal expenditures, secondary contacts to mail or email bounce backs and inbound communication setup.
*Detection and isolation costs typically include forensic and investigative activities, assessment and audit services, crisis team management and communications to Executive Management and Board of Directors
SYSTEM DAMAGE + BUSINESS INTERRUPTION BREACH NOTIFICATION CYBER + PRIVACY LIABILITY MEDIA LIABILITY REGULATORY PRIVACY ACTIONS CYBER EXTORTION COURT ATTENDANCE COSTS CRISIS COMMUNICATION COSTS
SYSTEM DAMAGE + BUSINESS INTERRUPTION
CYBER + PRIVACY LIABILITY
REGULATORY PRIVACY ACTIONS
COURT ATTENDANCE COSTS
CRISIS COMMUNICATION COSTS