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Data Security Risks for Small Businesses

03.12.2020

In the March 2020 issue of the Small Business Monthly “Financial Fitness” column, Greg Smith, Brown Smith Wallace Advisory Services Partner, discusses data security risks for small businesses.

According to Verizon’s 2019 Data Breach Investigations Report, 43 percent of data breaches involved small business victims. Unfortunately, there is still a pervasive sentiment among small business owners that they don’t possess enough data to warrant a security solution or that their data is unimportant to criminals. Small businesses are among the easiest targets because of a perceived lack of processes, security breach technology safeguards and IT staff.

Here are a few tips to consider as you assess your organization’s business systems and potential exposure to internal and external threats:

  • Invest in data security technology. Network security software can identify vulnerabilities before a data breach occurs. Data loss prevention software can identify sensitive customer data and help you manage who has access to that data internally.
  • Purchase cyber liability insurance. Cyber risk insurance is a specific coverage that is meant to provide financing in the event you experience a loss, but you should look for policies that offer more than just coverage of lost revenue. Appropriate cyber insurance coverage should be evaluated often, not just when a policy is first purchased. You’ll also want to ensure business interruption is included in your policy.
  • Ensure you have a plan in place before a data breach occurs. Small businesses must plan proactively for a potential data breach. This includes creating a response and recovery plan. Encourage your employees to be vigilant against phishing and develop an ongoing plan to audit your systems for the latest security updates.

Ramifications of any data breach can critically damage your business. For more information on our comprehensive cybersecurity and data privacy services, please contact Greg Smith, Advisory Services Partner, at gsmith@bswllc.com.

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