Cost of Cybersecurity Breach

Posted on March 22, 2018 at 5:28 PM

Cost of Cybersecurity Breach

In today’s era, companies strive to fill their success gaps and benefit themselves by utilizing advanced and innovative cyber technology. Thus, it leads to increased risks and threats to the security of a company’s sensitive data. This is what the rising issue of cybersecurity breach is all about.

Estimate cost of cybersecurity breach in 2017:

According to a research conducted by Ponemon Institute, the incidents of cybersecurity breaches, on an average basis, cost over $3.62 million across the globe. However, the average cost in the US is over $7 million now, which means it has increased by 5%. Surprisingly, the global figures have declined by 10% as compared to the year before. However, on the downfall, the frequency and intensity of these data breaches are continously rising. Moreover, it varies from country to country and depends on the type of market a company is in.

What is there to lose?

Many hackers and malicious individuals out there are waiting to steal the confidential data and financial information. These cyber attacks cost much more than what usually companies estimate. As a matter of fact, the companies do not only suffer great financial loss but also lose the trust of their customers. Hence, all the cost, energy and time invested in building a good customer base, ends up being wasted.

How to deal with cybersecurity breach?

The cost of a cybersecurity breach is not only restricted to what the companies lose in the process but it also includes what they have to spend in order to stabilize themselves. As simple as it sounds, it may cost a fortune! The lost status and reputation does not always recover. One way to deal with the aftermath of a breach is to react fast. The longer a company takes to re establish itself, the higher the cost and damage. So, a company needs to keep its walls high and yet be prepared for an unforeseen cybersecurity breach. Having an estimate cyber insurance provides an extra layer of protection.

Types of cybersecurity breach:

The cost of a security breach may vary according to its type. The top 3 types of breaches are as follows:

  1. Third-party failure:

    The external security breach occurs when malicious individuals from outside get successful in intruding a company’s privacy and stealing the crucial information and data. This type of cybersecurity breach may cost a company up to $3,289,864.

  2. Fraud by employees:

    Unfortunately, a company does not only face threat from external sources. Internal cybersecurity breach involves an employee being a fraud. Thus, it may result in removal of sensitive data from the company’s system. The average cost of this breach is $1,303,827.

hacking by employees

  1. Cyber espionage:

    This type of breach may be internal, external or a combination of both. A competitor company might provide fund to the hackers or fraud people to steal the crucial data. In this case, a company tends to spend $1,141,305 on an average.

hacking

Cybersecurity breaches now grabbing attention!

It is good to see that IT experts and proffesionals have grown concerned about this steaming issue. Companies have started to take considerable measures to avoid and counter a cybersecurity breach. After all, being proactive is always better than being reactive. A company might not accurately predict the cost of such breaches but having an estimate will certainly help. This topic has ascended in the IT specialists’ list of top concerns.

Can companies keep cybersecurity breach incident private?

Yes, sure they can! The companies do not necessarily have to disclose this information. But an incident with the severity of 44% or more forces the company to spill the beans. The news tends to reach the company’s customers, suppliers, regulators and the media. However, despite of the alarming severity, sometimes the companies do not publicly share the news as it brings disgrace. Still, let us face the truth that 90% of the companies have encountered a security breach.

keeping data private

Conclusion:

A cybersecurity breach has the capacity to destroy a company’s reputation and business in no time. The year 2017 has brought an increase in the quantity of such incidents. For some countries, the cost of a breach has escalated quickly. The companies worldwide should analyze their security measures and have an estimate cost in mind. Even though the real cost is likely to be higher than the estimated one, the latter will help in dealing with the consequences of a cybersecurity breach effectively.

 


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