CyberScout, the nation’s premier consultative provider of identity and data risk management, resolution and education services, today announced that it has worked with MSO Inc. (The Mutual Service Office, Inc.), a property/casualty rating service bureau to develop Data Breach Expense Coverage endorsements that are compatible with the MSO Commercial Lines programs. Two endorsement options will be available; one endorsement provides first-party property coverage while the other endorsement provides both first-party property and third-party liability coverage.
For carriers who adopt these endorsements, CyberScout provides services that include evaluation and assessment of a data breach situation and assistance with regulators and media relations. Reimbursement for the insured’s expenses associated with the notification of a data breach, as well as the expenses of forensic investigations and the costs to consult an attorney is also offered. A data breach hotline for recipients of data breach notifications to call with issues, questions or concerns and credit or fraud monitoring services is another service provided by CyberScout.
The Ponemon Institute estimates that a data security breach in the U.S. costs an organization approximately $194 per compromised record, or $5.5 million on average per incident, according to its 2011 Cost of Data Breach Study. Notification expenses account for about 10 percent of the total cost of the data breach incident prompting the need for a real solution to managing the financial impact of a data breach.
Jan Scites, CEO and President of MSO Inc, says “We are delighted to work with the expert team at CyberScout. The company offers an important coverage option and related services to insurance companies and their customers.”
In addition to the coverage and services outlined above, the property and liability endorsement provides coverage for third party claims and potential litigation brought against the insured for a data breach. This endorsement also provides coverage for defense costs, fines and penalties.
“Thieves looking for security holes to access data or accidental loss through a misplaced thumb drive can lead to exposure of confidential information,” said Samuel Broomer, vice president, CyberScout. “Coverage alone is no longer enough protection. We’re pleased MSO, Inc. has chosen us to offer breach expertise to their member companies.”
