December 11, 2017

Survey: Cyber hacking a costly expense for many businesses

PHOTO | David Castillo Dominici at FreeDigitalPhotos.net
PHOTO | David Castillo Dominici at FreeDigitalPhotos.net
Dealing with cyber data breaches can be expensive for many U.S. businesses.

Twenty-nine percent of U.S. businesses experienced a data breach last year, and eight in 10 spent at least $5,000 to respond, according to the latest survey from The Hartford Steam Boiler Inspection and Insurance Co. (HSB).

The survey, conducted by Zogby Analytics for HSB, a cybersecurity insurer that is part of Munich Re, also found that almost half of the breaches (47 percent) were caused by a vendor or contractor working for a business. Other causes included employee negligence (21 percent) and lost or stolen mobile devices or storage media (20 percent).

Financial impact of a data breach also was considerable: 27 percent of the businesses spent between $5,000 and $50,000 to respond and 30 percent spent between $50,000 and $100,000.

Zogby surveyed 403 chief executive, chief information, chief technology, chief operating, chief financial officers and other senior executives across the country. The businesses they represented are valued at anywhere from less than $5 million to more than $200 million.

"The results highlight how closely our economy and society are interconnected digitally," said Timothy Zeilman, vice president for HSB. The potential exposure to cyber hackers is not to be underestimated, he said.

In two-thirds of the data breaches, the businesses reported their reputation was negatively affected. When asked what the biggest hurdle would be for their organization to respond to a data breach, 51 percent said lack of knowledge and 41 percent a lack of resources.

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