Just released: How to raise venture capital in 2023

Download

4 Ways Cyber Insurance May Be Anthem’s Data Breach Lifeline

Carl Niedbala - Founder Shield
Carl Niedbala

COO & Co-Founder

 

For anyone that hasn’t heard, Anthem, one of the nation’s largest health insurance providers, suffered a data breach in which an estimated 80 Million customer and employee records containing personally identifiable information were compromised.

Fortunately for the company, it has around $200M in cyber insurance coverage.  While only time will tell if this is enough to cover all of the costs of this massive breach,  here are a few ways beyond lawsuits that cyber insurance can help ease the sting for both Anthem and affected customers alike.

1. Forensics

One of the first items of business for companies after suffering a data breach is usually figuring out what went wrong.   Very few companies (and even fewer startups) keep cybersecurity forensic experts on staff, so this will always be a consulting gig.  Given the number of compromised records and the complexity of the Anthem attack, it looks like the company will be racking up quite a few billable hours.

Forensic costs are covered by a good cyber insurance policy, so Anthem will likely find some relief here.

2. Notifications

As a major health insurer, Anthem has clients nationwide that suffered from this data breach.  One of the company’s duties is to notify these clients of the breach so that they can take actions to protect their data, check for identity theft, etc.

It seems simple enough to notify users, but here’s where it gets complicated: breach notification laws are at the state level, so the rules are different in each jurisdiction.  This can drive the cost of compliance way up.  It’s easy to imagine how this alone could kill a startup experience a growth rate when bootstrapped or after a small seed round.

However, a cyber insurance policy provides funds to cover breach notification costs.  Anthem will likely find some relief here as well.

 

3. Credit monitoring

Once users are aware of the breach, they’ll certainly want to check their credit scores on a regular basis.  Anthem has already set up a free credit monitoring service for affected clients.  Free for the clients, that is.

Someone has to pay for this service, and you can bet that it’s Anthem that has to foot the bill.  Again, Anthem’s cyber insurance can kick in to cover these costs because most policies will have a line item that covers the costs of credit monitoring services.

 

4. Regulatory Costs

Anthem is already under scrutiny from state and federal insurance regulators and there’s a good chance that other entities will get involved as well.  This is not uncommon in data breach situations.  When personally identifiable information is disclosed, it’s fairly certain that uncle Sam will get involved to protect consumers.  Again, cyber insurance will kick in to provide coverage for costs related to these regulatory actions.

In conclusion, the Anthem data breach serves as a stark reminder of the importance of having cyber insurance coverage in place to deal with risk effectively. These are just a few ways that cyber insurance can help Anthem and other companies suffering from a data breach.  Talk to us to learn more about how you can protect your company should the worst happen. You can go ahead and get a quote using the link below, too.

[vc_btn title=”GET A QUOTE” style=”outline-custom” outline_custom_color=”#ee2524″ outline_custom_hover_background=”#ee2524″ outline_custom_hover_text=”#ffffff” shape=”square” size=”lg” align=”center” link=”url:https%3A%2F%2Fapp.foundershield.com%2Fusers%2Fsign_up|||”]

Related Articles

cyber insurance pricing trends 2024
March 13 • Cyber Liability

Cyber Insurance Pricing Trends 2024

Uncertain about cyber insurance costs in 2024? Our article explores pricing trends, expert predictions on rate increases, and strategies to potentially reduce your cyber insurance premium.

cyber liability insurance premiums
March 4 • Cyber Liability

7 “Must Haves” For Cyber Liability Insurance in 2024

With cyber liability insurance premiums rising, business leaders must have the inside scoop to keep costs low. Our partners at Blacksmith InfoSec delve into those tips and tricks.

Cybersecurity Data Breaches
November 9 • Cyber Liability

Top 10 Cybersecurity Data Breaches of 2023

Today’s digital landscape is frightening for business leaders. Here’s a glimpse into some of the most cringe-worthy data breaches in 2023 — plus, how to avoid them.

Cyber Insurance Pricing Trends
July 19 • Cyber Liability

Cyber Insurance Pricing Trends 2023

After a hard-hit 2022, let’s explore the lessons learned, what currently impacts the cyber market, and cyber insurance pricing trends to expect in the future.

multi factor authentication
January 24 • Cyber Liability

Securing Your Company With Multi-Factor Authentication: A Complete Guide

Cybersecurity is a priority for most company leaders, with multi-factor authentication spearheading the endeavor. Here’s how to make it a reality in your organization.

cybersecurity-awareness-month
October 6 • Cyber LiabilityRisk Management

Cybersecurity Awareness Month 2022 — Data, Data, Goose!

As the leaves turn golden and the wind blows colder, cybersecurity awareness month is upon us! Here’s what it’s all about and how your company can stay cyber-safe.