Small business insurance is an effective way to protect important company information from the growing threat of data breaches.
While technology has rapidly advanced in today's business environment, the progress has brought along a few downsides with it. For example, both the prevalence of outsourcing and the ubiquitous use of online data storage, while effective for overall business growth, have significantly spread the risk of costly data breaches to many small businesses. According to Bloomberg Businessweek, what is normally a problem associated with large mega-corporations is now a major threat to smaller organizations, as well.
In fact, a recent Ponemon Institute survey of small businesses throughout the U.S. found 55 percent of respondents reported having previously experienced a data breach.
In addition to professional insurance policies, small businesses can employ many other strategies to reduce the risk of data breaches:
USA Today recommends taking an inventory of company data to determine the most valuable pieces and then getting rid of anything unnecessary. Businesses can then place the most important data behind stringent security measures such as encryption, password protection or physical safe storage.
The use of outsourcing can also increase the risk of losing important data. The Ponemon Institute survey also found 70 percent of small businesses believe data breaches are more likely when work is outsourced to outside services. However, 62 percent of those businesses admitted they did not have any protective legal contracts in place for their own outsourcing services. Such contracts can be another safety measure in not only preventing a potential breach but also protecting the business through legal language in the event that one would actually occur.
Data breach threats don't always come from outside the organization. Background checks on new hires across every division of the company are another safe way to avoid hiring the kind of people who might attempt to steal information, according to USA Today.