What are the data breach notification laws in Florida?

A data breach is the unauthorized access or release of someone's personally identifiable information (PII), which is any data that could reveal an individual's identity.

Data breaches can happen if an employee clicks on a link in a phishing email, if a laptop or thumb drive is stolen, or if hackers break into an online account. Accidental security breaches are another cause, such as misconfigured software that leaves data unprotected.

Every small business that handles credit cards or stores customer information is vulnerable to data breaches. IT consultants, healthcare providers, and financial institutions are among the industries with the highest risk.

The Florida Legislature defines personal information as knowing a specific individual's first name or first initial and last name in combination with their:

• Social Security number
• Driver license number, identification card number, passport number, military identification number, or similar number used to verify identity
• Financial account number, credit card number, or debit card number in combination with a password or other means of access
• Health information, such as an individual's medical history, mental or physical condition, or medical treatment or diagnosis
• An individual's health insurance policy number or subscriber identification number
• Username or email address, in combination with a password or other means of access

Any business that handles PII should invest in cyber liability insurance to mitigate costs in the event of a breach.

Florida businesses that experience a data breach must respond when the private information of a state resident was acquired, or believed to have been acquired, by an unauthorized person.

Under the Florida Statutes, businesses must report a breach "as expeditiously as practicable and without unreasonable delay... but no later than 30 days after the determination of a breach or reason to believe a breach occurred."

Notification can be delayed only when it would interfere with a criminal investigation. If an investigation and consultation with a law enforcement agency reveals that the breach likely won't result in identity theft or other financial harm to the affected individuals, notice is not required.

Florida businesses that experience a data breach must notify any residents whose private information was compromised. Both written notices and emailed notices are permitted. If the scope of the breach affects a large number of individuals, additional actions are necessary.

For data breaches that affect more than 500 Florida residents, businesses must also notify the Office of the Attorney General at the Florida Department of Legal Affairs. The notice to the Department may be delayed up to 15 days if a good cause is submitted in writing.

If more than 1,000 residents were affected, then the business must also notify consumer reporting agencies (TransUnion, Equifax, etc.).

Notices to Florida residents affected by a data breach must include:

• The date or estimated date of the breach
• The personal information that was exposed
• The business's contact information, for any questions from residents

Notice requirements for the Department of Legal Affairs include:

• A synopsis of the event
• Number of affected residents
• Services offered to affected residents
• A copy of the notice sent to residents
• The business's contact information
• Other information, such as police reports, upon request

Data breaches that impact healthcare facilities and healthcare professionals are regulated by federal laws. The Health Insurance Portability and Accountability Act of 1996 (HIPAA) includes a Breach Notification Rule that requires notification after a breach of unsecured protected health information. Businesses must notify:

• Affected individuals
• The Secretary of Health and Human Services
• The media, if over 500 residents of a state or jurisdiction were affected

Individuals must be notified by first-class mail, or by email if they've agreed to electronic communication, within 60 days of the discovery of a breach.

The cost of a data breach can be significant, which is why cyber insurance is so important for businesses that handle personal data.

Notifying those affected and paying for credit monitoring can be expensive. You’ll have to investigate and fix your security weaknesses while suffering a possible loss of income, and government fines can also be costly. You might even face a ransomware attack, where hackers shut down your computer systems and demand payment.

Small businesses most often need first-party cyber liability insurance. Also called data breach insurance, this policy provides financial protection against data breaches at your business.

You can often add this coverage to your general liability insurance or business owner’s policy (BOP), which combines general liability coverage with commercial property insurance at a discount.

If you're responsible for another company's data security, then you may need third-party cyber liability insurance. This policy covers legal expenses when a client blames your business for failing to prevent a data breach at their company.

Because most tech businesses need this coverage, it's usually included with their errors and omissions insurance (E&O) in a bundle called tech E&O.

E&O insurance, also called professional liability insurance, covers your legal costs in the event that a client sues you for making a mistake or failing to deliver on a contract. Tech E&O extends that coverage to include lawsuits related to data breaches and cyberattacks.

While any business could be at risk of a lawsuit after a breach of security, this coverage is especially important for information technology businesses, especially IT consultants, network security companies, and cybersecurity businesses that recommend software or are responsible for information security.

Florida businesses that fail to notify affected residents or the Department of Legal Affairs could face a civil penalty of $1,000 for every day that the data breach went undisclosed.

After the first 30 days, the fine increases to $50,000 for each 30-day period, up to 180 days. The maximum fine is $500,000.

For businesses that store data, it's crucial to take appropriate steps to prevent data breaches. In fact, the Florida Information Protection Act of 2014 (FIPA) states that businesses must take reasonable measures to protect and secure personal information.

Businesses are advised to safeguard private information through a variety of methods, such as designating one or more employees to coordinate a security program. It’s a good idea to conduct a security audit of the various types of personal information, unique identifiers, and other data elements you might have in your data systems.

Requiring strong passwords, security questions, two-step authentication, and access codes can provide reasonable data protection for your business and any service providers who access this information, reducing the chance of an unauthorized acquisition.

Complete Insureon’s easy online application today to compare insurance quotes from top-rated insurance carriers for cyber policies. Our licensed agents will help you find coverage that fulfills Florida's insurance requirements and protects your business. Once you find the right policy for your small business, you can begin coverage in less than 24 hours.