Companies have varying amounts of exposure to cyber-attacks, depending on their products. Many face significant liability, and should consider some form of cyber risk insurance.
Modern businesses, particularly those that conduct their transactions on the internet, face several vulnerabilities, including the following:
- Tax Identification Numbers
- Bank Account Numbers
- Medical History
- Proprietary Company Information
- Credit Card Numbers
- Customer Lists
A breach of any of these can lead to serious problems for a company.
The data liabilities can present significant exposure. However, the related business liabilities can cause even higher damages.
Many major national retailers have fallen under cyber-attack and have had to contact each of their customers and disclose that sensitive customer information may have been compromised. At the least, the customers needed to change their access codes. At the worst, they were advised to cancel their credit cards. The ability of customers to trust online transactions has always been a challenge. Problems with identity theft have made trust issues even greater. Many customers take a chance on online purchases on a tentative basis. If their credit information is compromised, they will likely reconsider making online purchases in the future. Security problems have compelled some people to abandon online credit card purchases altogether. This can be devastating for many types of companies.
Most companies have some measure of online exposure. It is important that all such companies assess that exposure, and hedge the cyber risk with sufficient insurance.