Staffing Services Corporate Identity Protection

By: Dorothy Taylor
Date: 7/1/2008

Protection for Staffing Firms and Their Clients From the Financial Burden of a Security Breach

The explosion of electronic data processing and transmittal as a daily part of business has dramatically increased the incidence of identity theft. More than 215 million data records of U.S. residents have been compromised since early 2005.1 In response to this threat, more than 35 states have passed laws requiring that businesses notify consumers if their personal information has or may have been compromised. Failure to do so can result in severe civil and regulatory penalties-totaling up to hundreds of thousands of dollars. Add to this administrative expenses, legal liability, and defense costs-as well as damage to reputation and customer confidence-and it is clear that a data breach is a serious threat to any business. As more companies have been hit by data breaches, new legal trends are becoming evident. Other companies who were indirectly affected by the breach may sue companies that have been affected by a breach; for example, financial institutions are suing companies who have suffered a security breach involving credit card or debit card numbers for reimbursement of the costs associated with reissuing cards to their clients. In addition, class actions may become a threat in the future as people become increasingly aware of the information held by companies that may be exposed; while no class action has been certified to date, the costs associated with class actions being brought can be extensive. Staffing firms have twice the concern. Not only must they protect the names, addresses, social security numbers, credit card numbers, and other personal data they may have on hand for employees, contractors, and clients, they must also manage their exposure for actions of temporary employees assigned to client companies.

Now, World Wide Specialty Programs, Inc. offers a solution- Staffing Services Corporate Identity Protection (Staffing Services CIP);

Staffing Services CIP protects staffing firms and their clients from the enormous expenses that can result from a data breach while protecting each business' balance sheet and reputation. The coverage provided to both the staffing firm and their clients includes:

• - Administrative action expenses, including costs associated with responding to an FTC or attorney general inquiry.
• - Notification costs - to quickly and efficiently reach out to all those individuals whose information may have been compromised.
• - Crisis management expenses to minimize adverse publicity and investigate the extent to which individuals' information may have been compromised.
• - Reimbursement for the cost of identity theft recovery services for victims, including credit file monitoring and an identity theft hotline.

Staffing Services CIP also covers damages and costs incurred in defending civil claims made against a staffing firm in connection with the theft of personal identity information or the unauthorized disclosure by an assigned worker of a client's trade secrets or other confidential information. Furthermore, with limits ranging from $250,000 up to $5 million, coverage is suitable for agencies of all sizes.2

Security Breaches Have Real Costs...

The average loss to a business that inadvertently released personal information in 2007 was $182 per name, per incident.

A stolen computer, dishonest employee or errant e-mail exposing information on just 5,000 people could cost $1 million in legal fees, notification expenses, customer service, and other costs-a 30 percent increase in the last year.3

Learn More

World Wide Specialty Programs has served the needs of the staffing industry for more than four decades and is consistently seeking new ways to meet the emerging needs of their valued clients.

To learn more about Staffing Services CIP, contact Charie McLaughlin at World Wide Specialty Programs - 631-390-0900 or e-mail - cmclaughlin@wwspi.com Visit World Wide Specialty Programs on the Web at www. wwspi.com.

1. Privacy Rights Clearinghouse, "A Chronology of Data Breaches Reported Since the ChoicePoint Incident" updated November 7, 2007.
2. Some sublimits will apply.
3. 2006 Cost of a Data Breach, Ponemon Institute, October 2006.