Cyberattacks can get a great deal of media attention, but, unfortunately, a majority of them don't. When a place like Target is hacked, it makes headlines. Many business owners don't feel like they are at risk. It's easy to become complacent with security measures because you don't think cybercriminals would ever come after your company, but they can. You need to know that cybercrime happens to companies of all sizes, and cyber liability insurance provides critical protection. Here are a few real-life examples of cyber liability claims resulting from hacks that didn’t make the headlines.
Online Ordering System Gets Hit
Retail companies that do business online are at an increased risk of a data breach. One clothing and accessory manufacturer that does half of its business online fell victim to hackers. The perpetrators gained access to the company's virtual shopping carts, stealing customer information over the course of six months. Investigators determined that the criminals obtained personal information, including credit card numbers and security codes, for more than 500,000 customers. This single breach could cost as much as $10.8 million in fines, litigation, investigations, and crisis management.
Medical Group Receives Phishing Emails
The healthcare industry is particularly vulnerable to cyberattacks, which have been on the rise and give no indications of slowing down. Phishing emails contain malware, and when an employee opens the email, a virus is introduced to the system. It only takes a single employee. This is what happened to a medical group. Though the computer had anti-virus software installed, the program did not detect or stop the virus. Criminals gained access to protected health information, leaving the medical group in violation of HIPPA laws. This business could face up to $590,000 in damages.
Construction Company Is Hacked
Storing sensitive data in "the cloud" exposes a company to the risk of a cyberattack. One national construction company hired third-party cloud storage services. That company was hacked, and the criminals accessed the construction business's data. This left personally identifiable information for thousands of customers in multiple states compromised. The construction company owned the data, so it was responsible for notifying customers about the breach. It is estimated that litigation, crisis management, and investigations could cost more than $862,000.
Food Bank Feels the Pain of a Security Breach
A non-profit national food bank that relies on donations to operate became the victim of internet hackers. Cybercriminals placed malware on the organization's servers, allowing them access to donor information, including credit card and security code numbers. Forensics determined that the perpetrators had information going back three years. This breach resulted in an estimated $847,000 in damages.
Cyber Liability Insurance Is Imperative
These cyber liability claim examples demonstrate how important it is for you to get coverage. Cybercrimes happen every day, and companies of all sizes fall victim. Any business that maintains a digital record containing sensitive information could be hacked, even if you believe your system is adequately protected.
About Axis Insurance
At Axis Insurance Services, we aim to help our customers identify their exposures and protect themselves. Founded in 1999, we offer insurance programs to a wide variety of professionals and industries including attorneys, real estate, healthcare, architects, and more, and also have a wholesale division. We pride ourselves on offering flexible insurance coverage tailored specifically to each customer’s needs. To learn more about our solutions, contact us at (877) 787-5258 to speak with one of our professionals.
