Target took out a full-page ad in major newspapers last month that apologized to the 110 million customers that were affected by its 2013 holiday season data breach. “Our top priority is taking care of you and helping you feel confident about shopping at Target,” the ad reportedly states, “and it is our responsibility to protect your information when you shop with us.”
If you’ve ever shopped at Target, it’s likely that you’ve already received an email directing you toward a page to sign up for free credit monitoring services, courtesy of the retail giant.
A splashy newspaper ad campaign? The ability to offer a bit of Experian-backed security to customers after a devastating data leak? Must be nice to be the big guy with all those millions of dollars to spend on damage control.
Luckily, that same kind of “damage control” operation is available to independent retailers, too – via their Cyber Liability Insurance. (For more about what Cyber Liability Insurance does for small-business owners, check out the blog post “Top Cyber Liability Risks for Real Estate Agents.”)
Cyber Liability Risk Affects Everyone, But Especially Small Businesses
As a small business owner, it’s easy to think that you’re no “Target” when it comes to cyber liability risk and data breaches. But the fact is, cyber criminals love to target small businesses.
According to Verizon’s Data Breach Investigations Report, 570 of the 855 data breaches in 2012 happened to businesses with between 11 and 100 employees, and 42 happened to businesses with between one and 10 employees. That means nearly 72 percent of data breaches targeted businesses like yours!
Small business insurance providers know this, and that’s why they’ve developed Cyber Liability Insurance (sometimes called Cyber Risk Insurance) policies specifically tailored to stores like yours. These policies offer you all the post-data-breach recover benefits that the big boxes get – and with a surprisingly affordable price tag. These recovery benefits might include:
- An advertising campaign. Just like Target, you can take out apology ads in the publications that your customers read – and your insurance will foot the bill (up to your policy’s limit). For reference, a full-page ad in a paper like The Washington Post in a prime location, like the back page, costs $29,831 daily and $32,410 on Sunday. But even the smallest ad in a local newspaper will likely be over $100 dollars a day.
- Credit monitoring services. The service that Target is using offers individuals credit monitoring services for $4.95 the first month and $14.95 after that. Multiply that number by the number of customers you have, and you can see how the cost starts to add up.
- Client notification. Before you can think about advertising campaigns and credit monitoring services, you have to notify clients affected by the breach. Depending on how many people are affected, this can end up costing your business a lot of time and money on its own.
- Investigative services. After a data breach, you may need to hire legal and forensic counsel in order to determine when and how the breach occurred – and what actions you need to take in order to comply with privacy and data security laws.
- Business interruption expenses. This includes the money it takes to hire additional staff, lease equipment, hire third-party services, and pay all the other additional labor costs associated with rectifying a data breach.
- Cyber extortion costs. Sometimes cyber criminals hold a business’s information hostage until you meet their monetary demands. Your Cyber Liability Insurance policy can reimburse you for these costs, too.
You don’t need to be as big as Target to be the target of a data breach. For more information on this topic, check out our blog posts “4 Reasons Your Business Should Have Cyber Liability Insurance” and “Can Your Small Business Survive a Cyber Attack?”