Retail Data Breaches Rock the Cyber Insurance Market

Lockton reports on the lessons that have been learned from the Target breach

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Sep 18, 2014, 05:34 ET

KANSAS CITY, Mo., Sept. 18, 2014 /PRNewswire/ -- Retail giant Target got an unusual amount of air time over the holiday season last year. Unfortunately for them, it was not due to their engaging commercials. Their positive consumer appeal was damaged by a massive security breach that stole payment card and customer sensitive personal information from 70 million customers. Two other breaches at Michael's and Neiman Marcus also made headlines and now there is a similar potential breach at Home Depot.

In the recent report "State of the Cyber Insurance Market: Ten Lessons Learned From Major Retailer Breaches," Lockton's Emily Freeman takes a look at the facts regarding the breaches, provides details on how they happened, the impact on companies with Point-of-Sale and credit card exposure, and how underwriters are doing things differently as a result.

http://www.lockton.com/whitepapers/State_of_the_Cyber_Market.pdf

Pretending that a breach cannot happen to your business is no longer an option. B2C companies are asking this essential question post-Target at their shop: "How bad can a bad day be?"

The Lockton report provides an in-depth look at what retailers and underwriters are doing to address this risk including:

A sharp uptick in coverage limits purchased
Customized insurance policy wording
Increased scrutiny of security and POS systems
Data breach response planning

"A breach can cause not only major financial loss, but also significant damage to brand and reputation if handled badly," said Freeman. "Lockton has developed a coordinated approach with clients so that all major aspects of breach response are built into the program they purchase, including pre-approved forensics and external legal counsel."

While cyber attacks are getting more sophisticated, so are the tools to combat them. By partnering with your insurance broker, you can protect your business from a devastating loss.

About Lockton

More than 5,300 professionals at Lockton provide 41,000 clients around the world with risk management, insurance, and employee benefits consulting services that improve their businesses. From its founding in 1966 in Kansas City, Missouri, Lockton has attracted entrepreneurial professionals who have driven its growth to become the largest privately held, independent insurance broker in the world and 10^thlargest overall. Independent researcher Greenwich Associates has awarded Lockton its Service Excellence Award for risk management for large companies. For five consecutive years, Business Insurance has recognized Lockton as a "Best Place to Work in Insurance." To see the latest insights from Lockton's experts, check Lockton Market Update.

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SOURCE Lockton