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Fireman's Fund Insurance Co. this week unveiled what it says is the first coverage available to small and medium-sized businesses for losses from payment card data breaches. News of the policy came on the same day that a non-profit research organization reported that data breaches increased 47% last year. The idea behind the coverage, according to Brian Gerritsen, product director at Novato, Calif.-based Fireman's, is to give peace of mind to business owners who are diligent about complying with the Payment Card Industry data-security standard, or PCI, the card networks' uniform protection rules that all card acceptors are supposed to meet. "That's what we're really trying to insure against-business owners trying to do everything in their power to protect their customers' cardholder data, but still find themselves in a data-breach situation and out of compliance with the PCI standards or other security standards that may apply to them," he tells Digital Transactions News. To get the coverage, however, a merchant must clear a number of hurdles. An applicant must already have property or liability coverage from Fireman's as well as the company's general data-breach policy first offered in 2006. The new payment card coverage is an add-on to that earlier product. Coverage is available to retailers and most other card-accepting merchants, but not schools and hospitals, says Gerritsen. The insurer excluded the former because of their high rate of data breaches and the latter because they hold extremely sensitive medical and personal data. If breached, a covered merchant could recoup about $160,000 in resulting expenses. That includes up to $50,000 for a PCI-specific forensic investigation, system scans and software, and hardware upgrades to get card security up to snuff. The policy also provides up to $100,000, with a 5% deductible, for PCI fines-"contractual penalties" in industry lingo-and related costs such as chargebacks and issuersâ€