What is the Cost of a Cyber Breach?

Understanding the cost of a cyber breach for an SMB and the threat vectors, or weaknesses that lead to data breaches, is the first step to protecting your financial solvency.

What is a cyber breach?

Although often used interchangeably, a cyber breach can differ from a data breach.

In a data breach, a cybercriminal infiltrates your systems, networks or software, or gains unauthorized access to your data. After infiltrating your ecosystem, the cybercriminal then exfiltrates the data, or takes it to use for their own benefit.

In a cyber breach, a cybercriminal infiltrates your software, systems, or networks, but you cannot determine whether they exfiltrated the information.

The problem with a cyber breach is that, although you can’t prove that the access led to stolen information, you still need to notify customers and engage in many of the post-breach activities that cost money.

What does a cyber breach look like?

From malware and ransomware to DDoS attacks, cyber breaches all look different.


A malware attack traditionally starts with a single user’s device and then spreads across your network. The program runs in the background while the user works, capturing the information that the individual types on the device. Since malware impacts individual devices and is hard to detect, the programs can take a long time to detect which often leads to cybercriminals having months of access before being noticed.


Ransomware, a type of malware, holds data hostage and requests a ransom to release it. The programs turn traditional information into encrypted, or unreadable, data. Ransomware, unlike other forms of malware, can shut down a company for days. Although the programs may run in the background for a while, they lead to a single event that can last days.

DDoS Attack

In a DDoS attack, cybercriminals send messages to the servers that store or share information between devices. The messages overwhelm the server which ends up shutting it down. This leaves businesses and their customers unable to connect to the resources that live on that server.

What is the cost of a cyber breach?

The cost of a cyber breach is enough that a single event can lead to an SMB filing for bankruptcy within a year.

According to the 2018 CISCO “Small and Mighty How Small and Midmarket Businesses Can Fortify Their Defenses Against Today’s Threats” report, the cost of a cyber breach for SMBs is significant.

  • 29% of SMBs in CISCO’s report said that breaches cost them less than $100,000.
  • 20% said that the costs were between $1 million and $2.49million.  

Meanwhile, the 2018 Ponemon Cost of a Data Breach report notes that the longer it takes to locate and respond to a data breach, the more it costs.

  • $1 million: the cost saved by companies containing a breach in 30 days

While the cost of a cyber breach can lead to financial strain, a proactive cybersecurity program with continuous monitoring can help detect and contain a breach which leads to a significant cost savings.

Why is the cost of a cyber breach so high?


Downtime, or business interruption, is one of the largest costs associated with an SMB data breach. Not only are you paying employees for time that they can’t work, you’re losing customer engagement. According to CISCO, 40% of SMBs who suffer a data breach have over 8 hours of downtime.

Damaged Systems

SMBs are less likely to have multiple locations where they store data. Thus, they often lack reliable backups and multiple servers. According to CISCO, 39% of organizations reported that an attack damaged more than 50% of their systems.


Notifying your customers, a legal requirement, incurs costs including gathering data, sending messages, and responding to concerns.

Legal Fees

Since recent laws, such as the European Union General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA), often give data breach victims the right to sue companies who experience a data breach, any cyber breach will require obtaining legal counsel and cyber forensics to help respond to any lawsuits.

How to decrease the cost of a cyber breach

Although most cybersecurity professionals believe that it is no longer a question of “if” a cyber breach will happen but “when” it will occur, taking steps to mitigate the cost can help strengthen your company.

Anti-Virus Protection

Anti-virus, anti-malware, and anti-ransomware products should be installed on all devices, networks, and systems. These programs help prevent malicious programs from installing and keep you protected from an attack.


Installing a firewall on your network prevents cybercriminals from being able to obtain access to data. Sitting between a device and a network, such as the internet, they control who is allowed in and out of your data ecosystem.

Security Patches

Systems, networks, and software release code that updates the software running the programs. These security patched protect you from vulnerabilities that cybercriminals use to infiltrate your data environment. The sooner you install the security patch, the less likely you are to suffer a cyber breach.

Continuous Monitoring

Automated tools that alert you to weaknesses in your controls help you respond before a cybercriminal can locate the weakness. By engaging in continuous monitoring, you can create a proactive security-first approach to cybersecurity.

Zeguro Helps Lower the Cost of a Cyber Breach

At Zeguro, we understand that protecting your company against a cyber breach can be overwhelming and expensive. This is why we created a holistic approach to help SMBs strengthen their cybersecurity programs/ Starting with a security-first approach to cybersecurity, we help you identify risks, create policies, and monitor control effectiveness. However, we go further than other other companies. We also provide the documentation necessary to meet increasingly strict industry standard and regulatory compliance requirements. As part of our  Cybersecurity-as-a-Service (CSaaS), we also direct you towards an end-to-end cyber insurance policy that fits your needs. To get early access to our end-to-end cyber safety platform and find out first-hand what CSaaS is all about, sign up for early access here.

Zeguro is a cyber safety solution and insurance provider for small to mid-sized businesses (SMBs), offering a comprehensive suite of tools for risk mitigation and compliance, as well as insurance premiums that are tailored to the size, sector and profile of a company.
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Karen Walsh
Written by

Karen Walsh

Contributing Editor

14 years internal audit experience.; award-winning writing professor. Cybersecurity writer focused on compliance and end-user awareness.

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