Understanding Data Privacy Risks

Understanding Data Privacy Risks

A recent article about data privacy in Forbes.com claims that data breaches cost an estimated $214 per record. The Ponemon Institute says that number will most likely rise.  A data breach of your customers’ or employees’ private information is a potentially expensive risk. Yet, many SMBs are unsure how to assess and remediate the risks of a data breach at their organizations.

The Forbes.com article lists five key questions business owners or board members should ask about the data privacy risks at their organizations.

  1. How much private data do we have and how sensitive is that data?
    When compromised data includes health information or social security numbers, the impact of the breach can have serious legal implications, in addition to negative impact on your reputation.
  2. What are the consequences if this sensitive data is breached?
    According to Forbes.com, “The loss of customer goodwill is one of the highest costs of data breach. In fact, more than 63 percent of breach costs are a direct result of lost business.” It is cheaper to prevent the data breach than it is to deal with the aftermath. “The cost to reduce the risk before a breach can be as low as 10 percent of the cost to remediate a medium-sized breach,” says Forbes.com
  3. Is my business a potential target?
    Data loss is often caused by a misplaced hard drive or a lost laptop or USB thumb drive, not a hacker. Risk of data breaches is especially high if you have mobile employees. Don’t forget to protect your business from internal data loss as well as outside hackers.
  4. Should I get insurance to cover part of the risk?
    Some businesses are turning to cyber and data breach insurance to help cover some of the risks; however, the policies vary greatly and they don’t cover the costs of lost clients. Be sure to collaborate with all stakeholders, including lawyers, financial advisors and data breach risk experts before you commit to an insurance policy.
  5. Has an outside party assessed your risk level?
    Most businesses are not trained to assess the risks associated with a breach of your company’s private data. Data breach risk assessment requires a professional and objective outsider view.  An external assessment can help you gain a real understanding of the potetial risks and the real costs associated with a data breach. An external expert will look at all regulatory and compliance requirements, inventory all of your business’ sensitive information, and create a breach response plan that will protect your organization.

The risks are real. If your business hasn’t experienced a data breach yet, it will. Having a plan in place will help protect your business, your employees, your customers and your reputation. A plan can also speed recovery time in the event of a breach.

Contact ACE IT Solutions today at 908-704-0400 for a risk assessment. Our experts are trained to help you understand and mitigate the risk’s to your business’ sensitive data.