Every year U.S. Companies lose billions of dollars due to the loss of client lists, source codes, or the recipe for the company’s “secret formula”. Insurance does not cover the loss of intellectual property leaving businesses paying for the loss themselves.
With the extreme background checks and rigorous employee hiring processes it is hard to think of a trusted cohort as a thief. But this tends to be the case. Most intellectual data is stolen by employees. This type of theft tends to rise right before an employee is about to leave a company. Robert Hamilton, director of product marketing at Symantec put it this way, “People take information because they feel they have an ownership stake in it. They helped create the data, and therefore they thinks it’s theirs”. This type of intellectual theft happens across all industries, computer programmers take codes, sale people take clientele lists, and customer service reps take accounts and company procedures.
One reason for the rise in intellectual property theft is the ease at which employees can take and store company information. With access to company files from remote locations and lack of security protocol it is easier than ever for employees to take company data. Small easy to remove storage devices with capabilities to hold massive amounts data also make it hard to track when someone has taken sensitive information.
First identify what trade secrets or other types of intellectual property your company has that is crucial to your success. One way to determine your most important information is to ask yourself, what would devastate your company if your competitors used or knew your important information? Now that you know what intellectual information you need to protect you can take action to keep it safe.
Cyber Risk Insurance and Crime Insurance
Companies can purchase Cyber Insurance to help with any cost of notifying customers of a data breach and civil liabilities. Unfortunately, this type of coverage does not cover any lost profit or lost clientele due to theft from an employee. In addition, crime policies typically cover employee theft of tangible assets, but not intangible assets such as trade secrets or intellectual property.
Source: Business Insurance, Guarding Intellectual Property, March 25, 2013