One commercial insurance provider has recently warned that the new Data Protection Directive draft, as expected by the end of 2011 from Brussels, could lead to businesses facing higher PI insurance costs.
Lloyd’s of London insurers are predicting that the new revision of the data protection laws will be a serious departure from the original draft as it was laid down a decade and a half ago. This is due to the new focus upon cyber security measures in the wake of a number of serious hacker attacks taking place recently, said one privacy and online professional liability insurance underwriter from Brit.
Industry expert, Ben Maidment, recently recommended the development of a standalone business insurance product in order to address exposures that would centre around the loss of critical and privileged data. The underwriter said that once demand for such a product grows, capacity in the Euro zone market place is expected to increase to the point where premiums would eventually come into line with the more robust and well-developed US market place.
Privacy and security breach fears have only been fanned into a frenzy due to the operation of ‘LulzSec,’ an anonymous hacker group that allegedly breached the Office of National Statistics and absconded with sensitive census data. One 19 year old UK resident has been apprehended by authorities for involvement in the cyber attack, but the young man’s level of involvement in LulzSec is currently under question.
In related news, recent research findings from a study published by the Ponemon Institute revealed that the average cost of an incident involving a data breach in the UK cost organisations a total of £1.9 million, which equates to £71 for every individual breached record. The survey also indicated that this figure was a 13 per cent increase over 2009 levels.