The Cost of a Data Breach

Posted on: October 24, 2017

The costs of a data breach greatly exceed expectations in nearly every case. There are simply too many components to a breach you must consider, from the initial response and recovery to the lasting impression on customers and employees. Each aspect of a breach must be identified, addressed, and recovered from in turn, usually at significant expense in time, money, or both.

What Are the Major Costs of a Data Breach?

Breach Assessment

After a data breach, you’re going to immediately start spending money and resources trying to determine the extent and source of the breach. You could skip this step, of course, but then every other problem on this list becomes bigger and you face the real threat of repeated breaches.

A failure to accurately assess the source of a data breach isn’t just bad business, it’s opening the door for significant liability down the road. A single breach through an unexpected vector may not be your fault, but the second breach through the same vector will absolutely be your burden to bear.

The Cost of Recovery

Once you figure out what happened, you have to recover and get back to normal operations while applying necessary fixes, patches, and updates to security practices. Depending on how much you were delayed in normal operations during the assessment phase, whether you have to roll back systems to clear out malware and viruses, and other factors, you could be looking at days, weeks, even months of lost work.

Documents will need to be rewritten, clients contacted again for information, projects reorganized and redeveloped. The costs can be immense.

Performance & Morale

Getting away from the more readily apparent and tangible costs of a breach, you should consider the impact on morale. Depending on the nature of the breach, this can be a serious problem or a minor one; if employee data leaked, expect a big hit to employee performance as a consequence.

A Hit to Your Reputation

A data breach tells customers, clients, business partners, and investors that your company isn’t safe. This can have catastrophic effects on any company, regardless of industry, branding, or prior reputation. No one wants to work with you if they have to worry about being compromised as part of the cost of doing business.

Even a minor data breach of limited scope can provoke unfair levels of scrutiny and distrust. That’s why it’s important to secure digital and physical data wherever possible. A minor leak of all your customers’ first names may not be particularly damaging in real terms, but having it out there that you leaked data on every customer can destroy a company.


Depending on the nature of the data breach, you could be on the hook for any problems which stem from the lost data. This is especially true if you knew about the exposure and didn’t take action, or with recurrent breaches. The standard for liability in many cases includes a common sense factor: Is it reasonable to assume that you should have done more to prevent the breach?

Protect Yourself from Breaches by Shredding with TrueShred

Any data breach represents a huge expense in time, money, resources, and reputation. Minimize the risk through good data management and document destruction practices, for digital and hard copy alike. Need professionals who can handle your secure document destruction needs? Contact TrueShred to find out what we can do for you and your business.

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