What Is a Data Breach?

Understanding data breaches

A data breach is when protected or confidential information is accessed, disclosed or stolen without authorization. That sensitive information could be Social Security numbers (SSNs), credit card details, medical records or login credentials.

A breach doesn’t always involve hackers breaking into a system. It can also happen when an employee accidentally sends sensitive information to an unauthorized person or when poor security controls fail to protect personal data.

But not all security incidents are data breaches. For example, a system outage could disrupt services without exposing data. A failed login attempt or blocked cyberattack doesn’t necessarily mean a breach occurred.

Data leaks vs. data breaches

Data leaks and data breaches are both potentially dangerous security incidents, but they differ in intent. Though both expose data, a data leak usually happens due to an error or oversight rather than an intentional attack. On the other hand, data breaches often involve malicious intent.

Types of data targeted

Attackers tend to go after data that can be easily monetized or misused for personal identity theft, such as:

• Personal identifying information: Names, birthdates and Social Security numbers
• Financial data: Credit card numbers and bank account details
• Login credentials: Usernames and passwords
• Medical or insurance records: Health histories, diagnoses and insurance policy number

Causes of data breaches

Data breaches can happen for many reasons, but most fall into a few major categories.

Cyberattacks

Cyberattacks are one of the most common causes of data breaches. These are deliberate attempts by hackers to access or steal data.

Insider threats

Insider threats can happen when someone within an organization causes a breach — on purpose or by mistake. A malicious insider could steal customer data for personal gain. An accidental insider might unintentionally upload sensitive information to an unsecured platform.

Because insiders already have access to systems, these breaches can be especially damaging and hard to detect.

Human error

Human error is another common cause of data breaches. These errors include:

• Wrong email address: Sending sensitive company or personal information to the wrong recipient
• Incorrect data uploads: Posting or sharing documents without the right security protections in place
• Configuration mistakes: Misconfiguring security settings in cloud applications

Impact of data breaches

A personal data breach can result in unauthorized charges, credit report inaccuracies, credit damage and emotional distress. In some cases, stolen data may be sold and reused years later.

For organizations, data breaches can seriously harm their reputation since customers may lose confidence in how the company handles their data and take their business elsewhere. Operationally, data breaches could also lead to significant downtime, disruptions and increased scrutiny from regulators.

The financial impact is huge, too. As of today, the global average cost of a data breach is about $4.4 million.

How data breaches happen

Many breaches happen because systems aren’t properly secured. Weak passwords, outdated software and unpatched vulnerabilities can all make it easier for attackers to gain access.

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Poor access controls also increase the risk of data breaches. When too many users have access to sensitive data, the chances of misuse or exposure go up. If companies fail to adopt a proactive cybersecurity strategy, it could result in severe consequences.

For example, in 2024, National Public Data experienced a data leak that reportedly exposed up to 2.9 billion records, making it one of the most extensive data leaks ever recorded. According to Christopher Hofmann’s lawsuit, a cyber criminal group called USDoD posted the private data of 2.9 billion U.S. citizens, including their full names, SSNs and addresses, on the dark web.

Responding to a data breach

When you suspect a breach, act quickly to contain the damage and secure your systems by following these steps:

1. Identify and contain the breach to prevent further access.
2. Secure affected systems and reset compromised credentials.
3. Investigate how the breach occurred and what data was affected.

Many laws also require organizations to notify affected individuals after a breach. Notification may include regulators or credit bureaus, depending on the type of data exposed.

If your business has just experienced a data breach, check out the Federal Trade Commission’s data breach response guide to help you respond correctly and quickly.

And if your personal data was exposed in a data breach, make sure to immediately change passwords on your affected accounts. You’ll also want to continue monitoring financial statements and credit reports for suspicious activities. Consider placing a fraud alert or credit freeze for extra protection.

Preventing data breaches

Knowing what to do after a data breach is important, but stopping one before it happens matters even more. Installing antivirus software, such as Webroot, can help set up firewalls and detect malware before it poses a security risk.

If you own a business, here’s how you can prevent data breaches.

Implement security protocols and employee training

Cybersecurity isn't just for people who work in IT. Every employee plays a role in preventing data breaches and protecting company assets. So it’s important that they understand how to protect sensitive information, like following password policies, using multi-factor authentication and securing login procedures across systems.

And since many breaches start with phishing emails or small mistakes, employees must also know how to spot suspicious messages and follow security best practices.

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Conduct security audits and vulnerability assessments

A security audit evaluates your organization's information security systems to identify vulnerabilities and assess compliance. You should regularly conduct security audits to uncover gaps that attackers could exploit and identify weaknesses before attackers do.

Vulnerability assessments and penetration testing can also reveal outdated software, unpatched systems or misconfigured settings.

Use encryption and strong access controls

When you encrypt information, it becomes unreadable to unauthorized users even if they gain access to it.

Strong access controls are just as important since limiting who can view or handle sensitive company data reduces the overall exposure to data breaches. Generally, employees should only have access to the information necessary to do their jobs.