In the United States, the average cost of a data security breach increased to $5.85 million this year from $5.4 million in 2013, according to “2014 Cost of Data Breach Study: Global Analysis,” conducted by the Poneman Institute and sponsored by IBM. While the organization’s bottom line obviously suffers, breaches inevitably lead to diminishing trust and reputational damage, especially for those in the financial services, health care and pharmaceuticals industries, which lead all others in terms of the resulting customer churn and the cost of damages.
Insurers are at risk, as they conduct more business electronically, move core applications to the cloud and offer customers and agents self-service access to data and systems. As more of that sensitive, personally identifiable financial and health information is transmitted, it potentially becomes more vulnerable to theft and vandalism.
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