As an advisor to middle-market businesses, I have become increasingly aware of the new risks that face our business owners, one of which is the theft of sensitive data. Sensitive information can be stolen by employees as well as external hackers, both of whom have the intent to profit from the data by causing great harm to your business or simply selling the data to those who can use it to their advantage.
In the 2017 Ponemon Cost of Data Breach Study, the average size of data breaches increased in size from prior years, to impact an average of 24,000 records. The average cost per record lost or stolen was reported at $141 per record.
I also understand that our technology and systems are critical to our ability to continue to operate our business. Not only can unsavory perpetrators steal our data, they can also lock up our systems. Thus, it has become increasingly important to invest in security measures to protect your data and your systems.
The Identity Theft Resources Center (ITRC) recorded 1,293 data breaches in 2017, exposing more than 174mm confidential records, up 21% from 2016.
The problem continues to grow in size and scope and it is my understanding that the insurance industry continues to develop products that can provide some insurance protection to affected businesses. However, businesses should take reasonable measures to protect against physical and cybersecurity breaches.
By Tom Bayer, CPA, CExP, Partner CPA and Advisory Services