Data Security Breach Insurance Saves Restaurants, Hotels Millions
Home/Uncategorized/Data Security Breach Insurance Saves Restaurants, Hotels Millions
Last Friday, Supervalu confirmed it's investigating a data breach affecting about 200 of its grocery and liquor stores. The breach also extends to store brands sold in 2013 to AB Acquisition LLC. In all, roughly 1,000 U.S. grocery stores are affected, with thieves potentially getting away with account numbers, expiration dates and cardholder names from store customers.
Also last week, United Parcel Service Inc. reported a breach of UPS computer systems at retail outlets that affected about 105,000 transactions and revealed names, email and postal addresses, and payment information belonging to customers.
Similar intrusions to make the news in recent times include the high-profile breaches at Target, P.F. Chang's China Bistro and Neiman Marcus Group.
As these data breaches become increasingly common, more and more retailers are opting for cards embedded with microchips that scramble account numbers and other data contained in traditional magnetic card strips.
The chips aren't a complete solution, but they'd prevent thieves from producing counterfeit cards with stolen information. Industry analysts note that wide use of chip cards in Europe, Asia and Canada has already triggered a dramatic drop in card fraud.
While the new chip-cards are costly for restaurants and retailers, many of which are already struggling in hard economic times, the financial impact of losing customer trust can be devastating. Plus, there's the costs associated with lost merchandise, which can total hundreds or thousands of dollars, law enforcement investigations, credit monitoring services offered to customers after the fact, public relations efforts to protect brand reputation, and other sources.
And businesses don't have to be a mega-corporation like Target or UPS to lose millions. A study by the Ponemon Institute, an independent research center that focuses on information security and privacy, states that common data losses are increasingly common and expensive to fix.
According to the 2014 Cost of Data Breach Study: Global Analysis, the average cost to an affected company was $3.5 million and increasing. The most significant damage to a company's bottom line occurs when customers leave due to loss of trust. Protecting against hacking, data breaches, credit card theft and other cyber security issues isn't optional any longer; it's a crucial part of managing any organization, no matter how large or small.
Data Breach Insurance coverage through IPOA helps protect your business from losses associated with losing sensitive customer information. Protecting your customer's data means protecting your brand's reputation and your bottom line. Call IPOA at 877-653-4762 to discuss a policy to protect your restaurant, hotel or other business from cyber security risks.
By adminipoa|2014-08-28T17:27:15+00:00August 28th, 2014|Categories: Uncategorized|
Happy New Year 2016 from Insurance Programs of America
Hotel Pool Compliance – ADA Standards
Cyber Liability Risks: The New Normal for Directors & Officers
Construction Spending Up for Hotels, Other Key Industries