Average cost of data breaches in Canada is on the rise – IBM

Average cost of data breaches in Canada is on the rise – IBM | Insurance Business Canada

Average cost of data breaches in Canada is on the rise – IBM

The impact and financial costs of data breaches have surged within the past few years – and may have also contributed to the rising cost of goods and services, a new report from IBM has found.

For the latest edition of its yearly Cost of a Data Breach Report, IBM worked with the Ponemon Institute to survey 550 organizations from around the globe about their experience dealing with data breaches between March 2021 and March 2022. The report found that the global average cost of a data breach between March 2021-March 2022 hit a record of US$4.35 million (about CA$5.5 million). Meanwhile, the average cost of a data breach across the world increased nearly 13% over the past two years.

Canada is paying more than the global average for data breaches, IBM warned in its report. Within the March 2021-March 2022 period, 25 Canadian companies paid an average of $7 million in recovery costs per incident, compared to the global average of $5.5 million. This high figure puts Canada as the third highest in terms of average cost of a data breach in the world for another straight year, just behind the US and the Middle East, the report said.

Among Canada’s businesses, it was those in the financial sector that paid the most for data breaches within the study’s period. Per compromised record, the Canadian financial sector paid an average of $520 per record. Meanwhile, Canadian tech companies paid $433 per record, followed by the service industry at $362 per record. The national average cost for Canada across all sectors was $298 per record.

IBM also suggested in its report that as data breach costs have increased, so have the prices for goods and services. It was noted that 60% of studied organizations around the world raised their products or services’ prices due to a data breach – even at a time when inflation and supply chain issues are causing pricing issues.

Cyberattacks also tend to have a “haunting effect” on their victims, the report mentioned. 83% of studied organizations have experienced more than one data breach in their lifetime. IBM also found that another factor that has been on the upswing is the aftereffect of data breaches, which can linger long after the incident. The report said that nearly 50% of breach costs are incurred more than a year after the initial breach incident.