Cyber Liability and Data Breach Response Insurance

These days, most businesses have direct experience with cybercrime, having received fraudulent emails, phishing attempts, robo-calls for bogus investment opportunities and debt relief, or else having been the target of increasingly sophisticated attempts to steal proprietary data. According to a 2025 report from data analysis firm TransUnion, U.S. companies lost an average of 9.8 percent of equivalent revenue to fraud. That’s 46 percent more than was lost last year and 27 percent above the global average. 

Clearly, hackers and other cyber-scammers are a problem that shows no signs of abating, and in fact is likely to grow. You hear a lot about data breaches in the news these days, but what about how fraud affects your business? Given these facts, it makes sense to educate yourself on the exposures and risks of cyber threats with Grinnell Mutual Cyber Liability and Data Breach Response FAQ. You’ll also find examples of breach types and what might be covered by insurance. 

Your cyber liability and data breach exposures

If you’re like most people, you probably think that when hackers set out to steal data, their targets of choice are the big retailers and restaurants that do hundreds or thousands of point-of-sale transactions every week.

In fact, though, all businesses, even small ones, are potential victims. According to the Identity Theft Resource Center (ITRC) cyber criminals compromised companies’ data 3,322 times in 2025 — an all-time high, and a number that obliged the affected companies to send out nearly 280,000,000 data breach notices to their customers and clients, a whopping 79 percent higher year-over-year. Business sectors most affected by the breaches included financial services (739), healthcare (534), professional services (478), manufacturing (299) and education (188).

How exposed is your business?

Does your company handle any of the following information?

• Employee or customer addresses
• Employee or customer Social Security or driver’s license numbers
• Copies of checks or credit card receipts
• W-9 forms
• Personal employee health plan records

If you have stored any of the above information, you are exposed. The exposure is not just from hackers intruding on electronic systems. Breaches are caused by lost, discarded, or stolen laptops, smartphones, and portable memory devices, to acts by disgruntled employees, to procedural errors.

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The price of a data breach

According to a 2025 report published by IBM, the global average cost of a data breach was $4.4 million.  AI is now casting a long shadow over the risk landscape. The IBM report said that 97 percent of organizations polled for the report said they’d had an AI-related security incident and lacked proper AI access controls, and 63 percent said they did not yet have policies in place for managing the AI threat. 

Resolving a data breach issue can involve lots of legal fees and requirements. All 50 states, plus D.C, Guam, Puerto Rico, and the Virgin Islands have breach notification laws, and more and more of them require a report to the state attorney general’s office. Many of the laws also include a ticking clock, so knowing ahead of time what’s required of you will save you some frantic documentation gathering when something does happen. 

Reducing the chance of a data breach

While data breaches are on the rise, the majority of incidents are fully preventable. Here are a few ways to reduce a chance of a data breach. For more information, the Federal Trade Commission (FTC) offers free resources for businesses of any size.

1. Automate patch management. Staying on top of the latest available software patches and moving to automated patch management can protect against a breach.
2. Enforce password complexity. Computer systems can now systematically cycle through all permutations of potential passwords. Don’t use passwords that are easy to crack. Dictionary words are capable of being deduced with an algorithm.
3. Be alert to phishing. Most breaches occur because of human error, and cybercriminals use that to their advantage through techniques like phishing — posing as a legitimate company to obtain financial information. Training employees to spot a phishing is a critical step in breach preparedness.
4. Double check before hitting send. Double-checking the contents of a file, email address, or mailing details is a must, especially when sending data to outside vendors.
5. Keep score. An easy and proactive way to determine whether or not your business’ bottom line is being compromised is to routinely monitor your profile with all three major business credit bureaus. The Consumer Financial Protection Bureau (CFPB) recommends a credit monitoring service, which will take the guesswork out of the process.
6. Protect your papers. Most business owners know to store their sensitive documents in a secure place, but it’s also important to invest in either a shredder to dispose of paperwork containing confidential information.  
7. Get the facts about cyber liability and data breach insurance. In this digital age, protecting your business from costly liability claims in the case of a data breach is not a should-do; it’s a must-do. We have collected common questions about cyber liability and data breaches and provided reliable answers to help you wrap your mind around this important business coverage.

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What Grinnell Mutual can offer your business

Experienced partners

Grinnell Mutual strives to offer our commercial customers top-quality protection and services. That’s why we partnered with Beazley, a leading insurer of technology and information security risks.

Our Cyber Liability and Data Breach Response Coverage, a solution to privacy breaches and information security exposures, is tailored to the needs of small to mid-size businesses.

This privacy breach response management and information security solution includes a range of services designed to help respond to an actual or suspected data breach incident efficiently and in compliance with the law.

Coverage includes

• Response to breach events, including notification, call center services, breach resolution, mitigation services, public relations, and crisis management
• Third party liability, including coverage for regulatory actions and payment card industry (PCI) coverage for credit card breaches
• Assistance at every stage of the investigation from Beazley’s in-house team of data privacy attorneys and technical experts
• Initial breach investigation and consulting
• Complimentary loss control and risk management information, including online resources and value-added educational webinars
  
  

For more information

Contact your local agent today for a quote or to learn more about Cyber Liability coverage.

Claims handling and breach response services are provided by Beazley USA Services, a member of Beazley Group. Beazley USA Services does not underwrite insurance for Grinnell Mutual. Policies purchased through Grinnell Mutual are subject to Grinnell Mutual’s underwriting processes.

The information included here was obtained from sources believed to be reliable, however Grinnell Mutual Reinsurance Company, SI, and its employees make no guarantee of results and assume no liability in connection with any training, materials, suggestions, or information provided. It is the user’s responsibility to confirm compliance with any applicable local, state, or federal regulations. Information obtained from or via Grinnell Mutual Reinsurance Company, SI, should not be used as the basis for legal advice and should be confirmed with alternative sources.

5/2026