Insurance exists for just about everything nowadays. This week I am reviewing Kelli Young‘s blog post, titled Cyber Case Study: Target Data Breach, considering a case study of a the famous 2013 Target data breach, and how having insurance could’ve alleviated much of the damage done. The post comes from CoverLink‘s blog. In 2013, Target fell victim to a significant data breach that compromised millions of customers’ personal and financial information. The breach happened due to an HVAC contractor falling prey to a phishing scam, giving access to their entire network. As discussed here on the ByteWizard blog, it is extremely important, especially for large corporations such as Target, to employ the same security standards for contractual workers as are employed for standard employees. The attackers installed malware on POS system, leading to the unauthorized collection of customer data, affecting 40 million credit and debit card details and 70 million personal records.
The aftermath of the incident was quite extensive for Target, involving recovery costs exceeding $250 million, legal expenses from over 140 lawsuits, and severe reputational damage, including a 46% drop in profits during the final quarter of 2013. The incident prompted the resignation of Target’s CEO and chief information officer in 2014
“The aftermath of the breach for Target was extensive … including a 46% drop in profits during the final quarter of 2013.”
– Kelli Young, CoverLink
This terrible situation for Target serves as a cautionary tale, emphasizing the importance of robust cybersecurity measures, an effective incident response plan, consideration of third-party risks, and securing proper insurance coverage to protect against cyber-related losses.
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