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cyber security: [September 2010]

Officials Debate Utility of 'Cyber Insurance' for Private Data
From "Officials Debate Utility of 'Cyber Insurance' for Private Data", TMCnet, August 9, 2010 and "Cyber Insurance Important for Lawyer, Firms" by Dolan Media Newswires, New Orleans City Business, July 27, 2010

Some higher education institutions are purchasing cyber liability insurance. Others, however, are confident in the rigor of their information security systems and see little value in cyber liability policies in higher education. "Rather than spending money at the back end, use your resources to prevent (risk)," said Bob Lim, University of Texas-Pan American (UTPA) vice president of information technology. "There's better use in working to fight intrusion than being scared of it." UTPA restricts access to private data and often trains staff and students on better use of technology like e-mail and mobile storage devices. Raising awareness helps prevent such incidents as users learn how easy it is to be exploited, said Jesse Rivera, associate vice president for privacy and security at UTPA. "It's not just technology but it's the human beings sitting in front of the computer," Rivera said. "We have to be vigilant in raising everyone's use of technology when they handle private information."

Information Law Group’s David Navetta points out that, despite the planning on the front end to protect privacy, something could still go wrong. The University of Utah paid $3.35 million for a June 2008 theft of over 1.7 millions individuals' personal information. The cost involved almost $700,000 in breach notification costs and millions of dollars more on credit monitoring, phone banks, personnel response, and more. "To try to just throw money at prevention instead of thinking about what could go wrong, that decision process is not the right one to make," Navetta said. "I think most organizations, not even just universities, with personal information would consider this." Cyber insurance can help cover the cost of a data breach, including the expense of sending notification to affected individuals, public relations, fines, penalties, responding to the state attorney general, and any subsequent litigation by affected individuals.
 

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