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« Cybersecurity

How Small Businesses Can Protect Their Data

CoverWallet’s data privacy manager outlines important steps that small businesses should take to keep valuable information out of the hands of hackers.

2 mins readNovember 28, 2022

About Bob

Bob Mattison is the data privacy manager at CoverWallet and Aon. Bob is an expert in data security strategy and data privacy compliance. We sat down with Bob to learn how small business owners can protect their company, employees, and customer data from hackers.

What is data security?

Simply put, data security means protecting everyone's personal information, including company, employee, and customer data for small businesses.

Why do small businesses need to have a data privacy strategy?

Hackers don’t discriminate about whose data they steal, and small businesses are just as vulnerable as everyone else. I think it’s a common misconception that only large corporations are the victims of cyberattacks.

A study by Verizon found that small businesses account for nearly half of all data breaches, and a report by IBM found that the average cost associated with a single data breach in the U.S. was $9.4 million. Unless your business can afford that cost, it’s vital to have safety measures in place.

I’ve also been a victim of hacking. During my time as a consultant, my business website was hacked. The cybercriminals had taken over the site and replaced everything with their own logo, and it took two days to resolve the issue.

Fraud is so prevalent, and one data breach can significantly hurt a small business and its reputation.

A survey by PwC found that 80% of consumers said they wouldn’t do business with a company that doesn’t adequately protect data. Any small business with a web presence must have strong data security practices. And it’s not just about how often you change your passwords; you need to ensure the third-party services you work with are using your data responsibly.

Many small businesses rely on online tools for marketing automation, email management, and accounting. When signing up for these services, it’s essential to read the terms and conditions. You need to understand how your data will be processed and handled. If any service provider plans to sell your information to a third party, that’s a major red flag. That can leave your business’ private information exposed.

What are some ways that small businesses can protect their data?

Recovering from a data breach takes time and money, so prevention is the best strategy. No matter the size of the business, it’s crucial to have a data safety program in place.

  • Educate yourself and your employees on recognizing phishing scams.
  • Mandate that passwords are changed regularly.
  • Always read the fine print on any service you’re signing up for; this will help you understand what information they have access to.