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New Cyber Study Reveals Average Total Data Breach Claim at $673,767

New Cyber Study Reveals Average Total Data Breach Claim at $673,767Leading cyber risk assessment and data breach services company, NetDiligence, recently released its fifth annual Cyber Claims Study, which takes a look at actual losses for data breach events covered by various leading cyber liability insurance carriers. The findings in the report are from a sampling of 160 cyber liability insurance claims, examining the type of data exposed, the cause of loss, the business sector in which the incident occurred and the size of the affected organization. The study also considers claims due to third-party breaches and claims due to insider involvement, both accidental and malicious.

The study found that the average total claim for a breach was $673,767, with an average payout for crisis services of $499,710. The average claim for a large company was $4.8 million, while the average claim in the healthcare sector was $1.3 million.

Other key findings from the NetDiligence claims study include:

  • Personally Identifiable Information (PII) was the most frequently exposed data (45% of claims), followed by Payment Card Industry (PCI) at 27% and Personal Health Information (PHI) at 14%.
  • Healthcare was the sector most frequently reached (21%), followed closely by financial services (17%).
  • Largest breaches occurred in the retail sector, followed by healthcare.
  • Hackers were the most frequent cause of loss (31%), followed by malware/virus (14%), staff mistakes and rogue employees (both at 11%).
  • Insider involvement accounted for 35% of the claims.
  • Third parties accounted for 25% of the claims submitted.
  • The median claim was $76,984. The average claim was $673,767.
  • The median per-record cost was $13.00; the average per-record cost was $964.31.

The study also found that smaller organizations experience most of the incidents. This is not surprising, the report reveals, there are more smaller companies than large organizations, smaller organizations are less aware of their exposure and may have fewer resources to provide appropriate data protection and/or security awareness training for employees.

Cyber Liability insurance plays a critical role in every organization’s risk management plan. Without a strong insurance policy in place, the costs of claims can be devastating to a firms’ bottom line. Axis Insurance Services works with several leading carriers to provide robust Cyber Liability/Privacy Network Security insurance solutions to clients in diverse industries, including healthcare and financial services. Give us a call at (877) 787-5258 to discuss how we can address your insurance needs.

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Blogged on: October 19, 2015 by Mike Smith
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