Philadelphia partner Steve Serfass spoke with Best’s News Service from the Reinsurance Association of America’s cyber liability conference in New York. Steve answered questions pertaining to data breaches and the recent rise in cyber liability related litigation.
With a reported 1,500 data breaches reported around the world last year, a rise in litigation associated with breaches is expected to continue. Steve stated that the fastest growing type of breach is hacking, and he expects that trend to continue.
The companies that have been victimized by breaches face significant expenses. In the interview, Steve pointed to at least four categories of expenses incurred in the typical breach scenario: (i) forensic investigation to determine and cut-off the source, (ii) providing notification; (iii) regulator inquiries, and (iv) litigation.
With breaches on the rise, increased regulatory activity on the enforcement end has also increased. “The companies that have been hacked and have had a loss of financial or health information about their customers then face a regulatory inquiry and enforcement action many times.”