JP Morgan Teaching NY Businesses a Lesson in Data Breaches & Cyber Security

In July, JP Morgan announced that hackers had compromised user contact information for 76 million households and seven million small businesses. That information included name, address, phone number, email address and internal JPMorgan information, the bank said in the disclosure. You may have not been affected personally, but your NY business can take away important lessons from this.

We have discussed cyber security risks before, but these events bring an important point to the forefront – if a Fortune 500 company like JP Morgan can be affected by cyber and data breach threats despite investing millions of dollars in securing databases, small to mid-size businesses are more vulnerable.

JP Morgan has yet to disclose their third quarter financials, but our guess is that a company of this size won’t be terribly impacted by the data breach. But think about it…

As a small or mid-size business, would you be able to sustain a cyber security attack or data breach if you don’t have insurance to protect you? Costs to remediate cyber liability attacks and data breaches can escalate up into the hundreds of thousands of dollars.

Data security breaches and compromises of customer and employee data continue to be reported at a high frequency across all industries. Healthcare, retail, hospitality and higher education industries in particular are faced with a higher threat due to the type of information retained. For example, retail operations often keep customer credit card information on file. Healthcare companies store information on social security numbers, medical records, date of birth, and other key personal information in databases. If your business offers any kind of automatic payment plan, you must have bank account or credit information on file.

The threat posed is not just to information retained on computers. Data breaches can happen if client or employee records are improperly disposed of, a break-in at an office occurs, or computer equipment is stolen.

When a breach occurs, you need to be ready to respond quickly and effectively to mitigate its exposure to brand damage and legal liability. Cyber liability products offer:

  • privacy breach response services
  • high limits for notification costs (you must notify anyone potentially affected by a data breach)
  • flexible limits for forensic expenses
  • coverage for crisis management and public relations
  • a separate sublimit for fines and penalties resulting from non compliance
  • credit and identity monitoring services

At The Murray Group, we create customized risk management programs for our partners. We discuss the threat posed to your business by cyber security and data breaches, and we offer solutions to mitigate exposures to your business. This is all part of our trademarked process, LiveSECURE 365™.

If you would like to speak with one of our risk consultants regarding this topic, please call us at (518) 456-6688 or email us at insurance@murraygrp.com.

Live SECURE 365,

Ryan Murray

VP, Risk Consultant

Photo credit to: http://www.dailymail.co.uk/sciencetech/article-2161444/Hacking-hackers-U-S-Companies-fight-cyber-crime–illegally.html