When it comes to cyber attacks, inaction is equal to the powerof evil intent: according to the Ponemon Institute, negligencecauses 39 percent, and criminal attacks cause 37 percent, of alldata breaches.

On the other hand, organizational readiness to tackle emergingcyber risks is paying off. While the cost of a data breach tocompanies increased by about 7 percent from 2008 to 2010, itdecreased by 24 percent—from $7.2 million to $5.5 million—from 2010to 2011. Damages include lost business, diminished customer trustand resources put towards credit report monitoring.

“Companies have improved steps taken in both preparing for andresponding to a data breach,” writes Robert Hartwig, economist andpresident of the Insurance Information Institute (I.I.I.).

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