NU Online News Service, Sept. 30, 11:16 a.m.EST

Cyber-risk coverage has become increasingly hot with news ofdata breaches, but these attacks on personal information are notlimited to larger companies.

According to a recent study, many breaches occur at smallbusiness with less than 100 employees.

To respond to the demand, Hartford has expanded its cyber-riskcoverage to include data-breach coverage designed for smallbusinesses.

“So far the feedback from our agencies has been positive andwe've learned the awareness of this is not pronounced,” says HollyMoriarty, marketing director for Hartford small commercialinsurance.

Small businesses likely do not have the resources of bigbusiness to combat and recover from data breaches.

“Response is critical and it could be complicated, withdifferent regulations requiring different responses in each state,”Moriarty explains.

The insurance—an endorsement to the company's Spectrumbusiness-owners' policy—provides coverage for expenses and legalliability as well as access to services to help comply withregulations and customers' concerns, such as how to notifycustomers, craft letters and perform credit monitoring.

“Customers are important to any business, but with smallbusiness, many times they think of their customers as extendedfamily,” Moriarty says. “Relationships are formed. You know theirnames and faces. They don't want to jeopardize thatrelationship.”

Hartford has partnered with Identify Theft 911 to providepolicyholders with risk management advice to protect against databreaches, Moriarty adds.

The coverage could be beneficial to restaurants and retailers aswell as businesses that store client or patient data, like those inhealthcare, financial or professional services.

According to a report by Verizon, of 760 data breaches analyzed in 2010, nearlytwo-thirds involved businesses with less than 100 employees.

The report finds that breaches typically do not require a highdegree of sophistication and victims are a target of opportunityrather than choice.

Almost all breaches are avoidable with expensive correctiveactions, says Verizon.