Beyond the breach: 5 steps to cyber-loss recovery

Target. Michaels. P.F. Chang’s. We are hearing more and more the names of major corporations victimized by data breaches. More alarming than the corporate names themselves are the insurance claims, damages and costs associated with a single data breach event. 

A 2013 study of the average insurance carrier payout on a data breach claim from that same year (not including the uninsured loss) found that the average claim payout was $954,253. Further, when accounting for pending claims and self-insured rententions that were likely to be associated with claims in 2013, that average insurance carrier payout rose to $3.5 million per claim. Contrast that to some figures that have the average homeowners property damage claim just over $34,000 for fire, lightening and debris removal claims and averages of approximately $7,300 for water, wind and freezing claims, and we really should be alarmed.