Which of these is a potential consequence of a cyber incident?

Study for the Certified Insurance Counselor Commercial Multiline Exam. Utilize interactive flashcards and multiple-choice questions, all with detailed explanations. Prepare thoroughly for your exam!

A potential consequence of a cyber incident entails a loss of income due to a data breach. When a company experiences a cyber incident, such as a data breach, it often faces significant financial repercussions. These can include immediate financial losses from business interruption, costs related to investigating and mitigating the breach, potential legal fees, regulatory penalties, and the expenses associated with notifying affected customers.

Additionally, a data breach can undermine customer trust, leading to decreased customer retention and reduced sales. This loss of confidence from existing customers, coupled with negative press coverage and regulatory scrutiny, can impact revenues for an extended period. Therefore, the financial ramifications following a data breach can be severe and long-lasting, affecting a company’s overall profitability.

In contrast, options suggesting increased revenue due to publicity, enhanced reputation, or guaranteed customer loyalty do not typically align with the realities of the aftermath of a cyber incident. In fact, the opposite is more common, as such events often damage a business’s reputation and lead to diminished trust among customers and stakeholders.

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