Costs of data breaches
Data breaches are one of the most likely and most expensive threats to businesses. It is reported via the “2016 Cost of Data Breach Study” that the US has the highest data breach costs in the world.
The study indicates the proportion of direct and indirect data breach costs varies by country, with the Arabian Peninsula having the highest direct costs and the US having the highest indirect costs. Direct costs refer to the direct expense outlay to accomplish a given activity such as engaging forensic experts, hiring a law firm or offering identity protection services to victims. Indirect costs include the time, effort and other organisation resources spent during the data breach resolution, including the use of existing employees to help in the data breach notification efforts or in the investigation of the incident, customer churn and loss of good will.
Healthcare Industry data breaches are the most costly of any Industry and direct costs make up 34% of the total cost of a breach, such as detecting the breach, escalating the response, auditing, and hiring legal defence. The larger costs are the indirect costs of lost customer business, such as customer turnover, decrease in new customers, and brand damage.
Despite the studies that illustrate data breach costs, and the growing frequency of data breaches, companies face a challenge to quantify and kerb their cyber risk exposure. As companies develop this capability, they need to prepare and plan for the worst-case scenario.
For more information on the cost of a data breach industry, please go to http://www.calyptix.com/hipaa/healthcare-data-breaches-expensive-average/