What’s the Average Cost of a Data Breach?: How to Cost-Effectively Manage Your Cyber Risk
It’s been another bad month for data breaches. In highest-profile breach, Experian famously had 15 million records stolen. 7 Trump Hotels fell victim to hackers. 80,000 California college students are suspected to be at risk for stolen data. And 4.6 million Scottrade customers were affected in a cyber-attack.
That’s a lot of stolen records, and that’s a lot of money spent on recovery.
Even though it’s the high-profile breaches that get mentioned in the news, many smaller breaches happen every day. Organizations of all sizes are at risk for cyber-attacks – and the expensive costs incurred to clean up after an event.
Here’s the average cost of a data breach, and how your organization can prevent breaches from occurring.
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The Average Cost of a Data Breach
Each year, the cost of a data breach increases. The Ponemon Institute, the industry’s leading research institute for information security, reported that in 2015, the average cost of a data breach increased from $145 to $154 per lost or stolen record. This is especially troubling since data breaches seem to be increasing in both frequency and severity.
What does the average cost of a breach translate to in real numbers? If we were to take that figure from the Ponemon Institute ($154) and apply it to a moderate data breach of 100,000 records, the responsible organization could be on the hook for $15.4 million.
Why Are Data Breaches So Expensive?
If that figure seems high, it is. Many businesses don’t recover from the costs incurred after a data breach. Here’s a breakdown of why the cost of cyber-attacks is so high:
- Identifying the breach. Often, organizations that have fallen victim to data breaches don’t know a breach has occurred until the leaked data has been posted online. This means significant resources need to be expended to find the source of the breach and stopping the vulnerability – fast. The longer cyber criminals have access to a company’s data, the greater risk that company faces.
- Regulations. Various local, state, and national laws place specific requirements on companies affected by data breaches. Sometimes, these costs include contacting each person affected. In some cases, identity theft protection must be provided
- Brand management. The cost of public relations, marketing, and other brand management expenses after a breach can be high. Companies must also take into consideration the potential for lost revenue due to loss of consumer confidence.
How to Prevent a Data Breach
The expenses listed above are not comprehensive by any means, but they should give you a good idea about why the average cost of a data breach is so high. When compared to the cost of cybersecurity measures and prevention, however, the solution is clear. For a fraction of the cost of a single breach, your organization can identify potential vulnerabilities, protect its data, deploy advanced security measures, and more.
Here are some ways to prevent a security breach:
- Perform a vulnerability audit. Begin by having cybersecurity professionals review your organization for potential vulnerabilities. This can include network vulnerabilities, malware detection, and more.
- Encrypting sensitive data. While some data, such as patient records, must be encrypted by law, it is a good practice to use encryption on all valuable data to make data worthless to hackers in the event of a cyber-attack. This is especially important for login information (such as usernames and passwords).
- Educate workers. The best cybersecurity measures won’t work if your employees aren’t safe online. Looking beyond IT solutions and educating your workforce adds an additional layer to your cybersecurity plans.
- Implement an intrusion detection system and other solutions. Depending on your network needs, choose a firewall, intrusion detection system, and other essential security solutions that will cost-effectively protect your sensitive data. Your vulnerability audit will help you understand what kinds of solutions would work best for your unique setup.
Contact Cybersecurity Professionals in Maryland Today
If you’re based in Maryland and are worried about protecting your business from data breaches, contact one of the many cybersecurity professionals your area. Buy Maryland Cyber has the most comprehensive list of local Information Security Specialists, making it easy for your business to find the right solution. Don’t wait. The average cost of a data breach is only increasing, and investing in preventive solutions is well worth the investment.
Interested in employee training or a vulnerability assessment? The following companies can help your organization identify risk areas and develop cost-effective cybersecurity solutions:
- Phalanx Secure
- Deep Run Information Security Services
- Cyber Center @AACC
- Dunbar Cybersecurity
- Alliance InfoSystems LLC