Ecommerce Privacy Breaches: Preparing for the Exposure
Small business owners have always had countless responsibilities; however, as the use of technology has grown, so have the risks for some business owners.
Online shopping sales are increasing year over year. Traditional brick and mortar retail shops are feeling the need to compete. Many are now offering online shopping options as well. But are they prepared for the risks that coincide? Just as they need burglar alarms and safes to help protect inventory, they need firewalls and encryption to protect something more valuable: their customers’ personal information.
You don’t hear of customers choosing not to shop at a store because of a theft of their goods, but it is very common for retailers to lose business after a privacy breach.
Approximately 1.5 million people are affected by some type of cybercrime each day, and small businesses are no exception. Furthermore, about 60 percent of web attacks target online businesses because most are not properly protected or well equipped to handle these attacks. As technology becomes more sophisticated with credit/debit card chip and pin technology, hackers will start to divert their attacks to ecommerce even more. Consider the following claim example:
Due to overwhelming demand, Miguel, the owner of a small clothing store, paid to have an ecommerce site built. He was very impressed with how much traffic his site was getting. After six months of his site launching, he became aware that his site had been compromised. Everyone who was shopping on the site had their information, including credit card numbers, taken. Miguel had to take the site down for several days – including Cyber Monday, which is one of the most profitable days of the year. He paid over $30,000 in attorney fees and forensics within the first week, in addition to lost profits. Miguel calculated that he could have made $75,000 from Cyber Monday alone.
Not only did Miguel’s company lose the opportunity to capitalize on a very profitable day, Miguel had to spend an ample amount of money to recover from this breach. As a small business owner, this can cause a permanent shutdown if the funds are not available. Most business owners aren’t aware that a cyber policy with business interruption could indemnify them for this type of loss.
We recently launched data restoration and business interruption coverage for our Cyber Liability & Data Security+ product. In addition to the lost profits Miguel experienced, he also would have had coverage for forensics, notification costs, credit monitoring for his customers, as well as access to one of the industry leading breach coaches available.
To learn more about business interruption, data restoration and other optional coverages often found on cyber policies, sign up for our Cyber Summer Webinar Series. The first webinar in the series, A Closer Look at Optional Cyber Coverages, is on Thursday, June 16 at 2 p.m. EDT. Register >>
As always, thank you for your support and business.
Written by Melyssa Uribe
June 9, 2016
Contact Meredith Bennett,
Cyber and Technology Product Leader | 888-523-5545 Ext. 2598