Sustaining a cyberattack is a scary thing for a lot of businesses. Most companies scramble around for months trying to assure their customers that their service is safe to use, assessing the damages that can often lurk under the radar and updating their security protocols to prevent future attacks. But that's not all that can happen.
If the data breach was bad enough or affected a large number of customers, your business could face a class-action lawsuit. Just one more thing to worry about!
Luckily, cyber theft insurance will protect your company from the detrimental effects of cybercrime, data breach and class-action lawsuits. Below are a few of the companies that suffered lawsuits and what you can do to avoid a similar incident.
After several data breaches were reveal that affected more than 1 billion users, Yahoo is facing a class-action lawsuit that states: "Yahoo failed, and continues to fail, to provide adequate protection of its users' personal and confidential information and has failed to provide sufficient and timely notice or warning of potential and actual cybersecurity breaches to its users."
Not to mention that the recent bad news has somewhat soured its acquisitions deal with Verizon, resulting in a $350 million price cut.
In 2013, Target was struck by a data breach that compromised personal payment information for as many as 110 million people. Just two years later, the retail giant suffered two class-action lawsuits. The first resulted in a $10 million settlement to the victims, and another resulted in a $39 million settlement to the banks that reimbursed customers for credit card fraud.
This incident severely damaged customer confidence in the company.
By now, almost everyone is familiar with the extramarital affair website Ashley Madison and the crippling cyberattack the site suffered in July 2015. Since the site kept users' personal information, including real names, home addresses, search history and payment records, the hack resulted in high-profile news articles and public shaming for many of its members.
In the end, Ashley Madison agreed to pay a $1.7 million settlement.
In 2014, Home Depot saw a colossal data breach which leaked email and credit card information from more than 50 million customers due to compromised self-check-out terminals. The company agreed to two major payouts. The first shelled out $19.5 million to consumers, which included $6.5 million towards identity protection services. The second paid $25 million to banks and credit card companies.
The overall cost of this data breach? More than $179 million!
The Bottom Line...
The bottom line is that if you want to retain customer confidence in your organization and avoid litigation, you need to invest in robust cybersecurity protocols and employee education. Otherwise your company could end up on a list like this.
If you are hit by an attack, cyber theft insurance from CyberPolicy will help you through the tough times by assisting with legal fees, settlements, media liability, privacy liability and credit monitoring. Interested in seeing it for yourself? Visit our homepage to learn more!