There are all kinds of ways your business might be wasting money, from unused software subscriptions and random things on auto bill, to extra user accounts you no longer need. However, these expenses are relatively small compared to what poor cybersecurity can cost you.
Cybersecurity incidents are costly
You’re probably aware that violating certain data privacy and protection laws can result in regulatory fines. These fines range from a few hundred dollars to millions depending on the severity of the violation.
For example, HIPAA violations range between $100 and $50,000 per violation, and the exact amount is calculated based on the perceived level of negligence. Considering one leaked record is considered one violation, that’s an expensive mistake.
Data security regulations, like HIPAA, GDPR, PCI-DSS, CPRA, and others are specifically designed to protect personal information. While no cybersecurity system can keep data 100% safe, a strong plan, the right software, and intentional execution of company policy can drastically reduce the chances of a security incident.
Every industry needs a cybersecurity protocol, even fleet maintenance teams secure their devices. Hackers don’t discriminate, and one attack can financially devastate a business enough to put them out of business for good.
Here are several reasons a strong cybersecurity posture can prevent your business from going under because of a cyberattack.
Ransomware is expensive and often impossible to recover from
According to statistics, 71% of businesses experienced a ransomware attack in 2022. This is one of the worst types of attacks.
It’s imperative to have a strong defense against ransomware that includes not just antivirus software, but also regular backups and a functional restoration plan. Scanning for existing malware isn’t enough. Your antivirus application might not prevent employees from downloading ransomware directly from an email or other source. You need backups so you can essentially just walk away from the issue and start fresh without entertaining the hacker’s demands.
Ransomware encrypts data on a device’s hard drive, making it impossible to access without the decryption key. The hacker will offer to decrypt the data only after a payment is made. If you give in to the hacker and pay them, you risk losing that money for nothing because there’s no guarantee they’ll restore your data.
Some companies are asked to pay big ransoms in the range of hundreds of thousands to millions of dollars. In 2021, an insurance company paid a $40 million ransom. For a large corporation, that’s a setback, but not enough to take them down. For a small business, sometimes even a $10,000 ransom demand would be too much.
The cost of being hit by ransomware adds up.
- The ransom. If you choose to pay the ransom, consider this amount a loss. Even if you get your data back, it’s still an unexpected expense that never should have existed in the first place.
- Recreating your files. If you don’t pay the ransom or the hacker won’t restore your data, you’ll need to start over to recreate your files. This may or may not be possible, as some data is likely irreplaceable. If you had anything professionally created, like a business plan, graphics, or even software, if it’s not backed up somewhere, you will be starting from zero.
- Lost business. During the time you’re impacted by ransomware, you’ll probably lose some business if being locked out of your files impacts your ability to fulfill your customers’ needs.
- Damaged reputation. If a ransomware attack makes it hard to serve your customers, you can expect your reputation to suffer a bit.
Data leaks and breaches destroy trust
In addition to ransomware attacks, both data leaks and breaches tend to diminish customer trust in a business. It only takes one small incident for this to happen, although severe incidents – like the 2013 Target breach – have far worse consequences. In the Target incident, hackers stole data belonging to more than 40 million consumers, and Target ended up paying an $18.5 million dollar settlement, which was a record high at the time.
To this day, there are still people who refuse to shop at Target even though this issue has long been resolved. People are put off by the fact that the company didn’t take precautions to protect customer data in the first place.
Secure your business against avoidable fines and penalties
As you can see, cybersecurity incidents are costly. The only way to avoid paying regulatory fines and lawsuit settlements is to beef up your cybersecurity efforts and protect sensitive data from the beginning.
For example, you can encrypt data so it can’t be read even if it gets stolen. This is a great fallback to protect against threats that slip through your perimeter.
If you haven’t already, consult with a cybersecurity specialist to secure your business and avoid unnecessary damage to your business.