Reducing the Harm of Data Breach Fallout

Businesses large and small are worried about a data breach. And for good reason. Data breaches negatively affect customer confidence and recovery can be expensive. For these reasons and more, many companies have decided to invest in cyber insurance.

Cyber insurance providers help organizations cover the costs associated with data breach. This includes coverage for legal fees, data recovery, network repair, investigations, and more. While policies differ, it's an essential service all companies should consider.

Then again, a lot of companies are failing to manage data breach fallout. And mishandling a data breach only makes it worse. Below are a few suggestions on how to best mitigate the fallout damages to your company and your reputation.

Get Ahead of the Story
According to Harvard Business Review, companies are waiting too long to reveal data breaches to their customers. This foot-dragging leads to a higher likelihood that hackers will be able to use stolen data.

"While Equifax got blasted for taking nearly six weeks to disclose its breach, at least it didn't wait until the stolen data was being sold on the dark web to go public with the news, writes HBR.

Sure, it may take companies months or even years to discover a data breach. But once your company discovers the incursion, it's time to tell your customers. Otherwise, you risk a public relations nightmare.

Anticipate Solutions
"In 2016, Yahoo CEO Marissa Mayer failed to take a basic step that could have quickly protected customers whose accounts were exposed in a breach that occurred two years prior: automatically reset all user passwords," writes HBR. This leads us to our next suggestion: anticipating solutions. Data breaches are all but inevitable. It's how a business responds, that is most important. If your data breach was rooted in a phishing scam, you'll need to do more to train your employees to detect these threats. If passwords were cracked, you'll want to implement two-factor authentication (2FA).

Ask yourself: How can you best improve your operations to prevent future data breaches? How can you nudge customers in the right direction regarding cybersecurity?

Provide Actionable Tips to Consumers
When delivering the bad news about a data breach, it's important that you provide customers with some direction. Nobody likes to feel helpless at a time like this. Advise your customers to:

  • Regularly check their credit card statements for suspicious activity. A data breach might leak their information in December, but a hacker might wait until March to make a fraudulent transaction. Checking your statement will prevent anything from falling through the cracks.
  • Consider a credit freeze to prevent scammers from opening accounts in their name. This could cost roughly $20 to freeze and unfreeze an account per each credit reporting agency. But it's far better than be taken for thousands.
  • Place a fraud alert through a major credit reporting agency. This free service last 90 days and requires businesses to verify identity before issuing credit.

Your data breach disclosures should instill confidence in your customers, not terror. Show them that you are keenly aware of the situation by providing actionable tips.

Lastly, you'll want to partner with a cyber insurance provider. These companies are more than willing to walk you through the disclosure process. Don't suffer data breach alone. Visit CyberPolicy to find the provider right for your needs today!

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