TL;DR
Incident response costs startups $10,000-100,000+ per incident. Forensic investigators charge $150-500 per hour. Legal counsel adds $300-600 per hour. Customer notification costs $1-5 per affected user. Most startups lack in-house IR capability, making external services essential. Having an incident response plan before an incident can reduce costs by 30-50%.
$150-500 Hourly rate for incident response forensic investigators Source: SANS Incident Response Survey 2024
The Phases of Incident Response and Their Costs
Incident response follows a structured process, each phase with its own costs. Understanding these phases helps you estimate total incident costs and identify where preparation can reduce expenses.
| Phase | Duration | Typical Cost |
|---|---|---|
| Detection and Analysis | Hours to days | $2,000 - $15,000 |
| Containment | Hours to days | $3,000 - $20,000 |
| Forensic Investigation | 1-4 weeks | $10,000 - $50,000 |
| Eradication and Recovery | Days to weeks | $5,000 - $30,000 |
| Post-Incident Activities | Weeks to months | $2,000 - $20,000 |
Detailed Cost Breakdown
External Incident Response Services
Most startups lack dedicated security staff capable of handling incidents. External IR services provide the expertise needed but come at significant cost.
IR Firm Pricing Models
- Hourly engagement: $150-500 per hour, best for smaller incidents where scope is clear
- Daily rate: $2,000-5,000 per day, common for active incident response
- Retainer: $5,000-25,000 per year, guarantees availability and often includes discounted rates
- Fixed fee: $15,000-50,000 for defined scope investigations
No retainer penalty: Without a retainer, IR firms may not be available immediately. During major cybersecurity events affecting many companies, wait times can extend to days. Retainer clients get priority response.
Forensic Investigation Costs
Forensic analysis is often the most expensive component of incident response. Investigators must examine logs, memory dumps, disk images, and network traffic to understand what happened.
| Investigation Scope | Time Required | Cost Range |
|---|---|---|
| Single system analysis | 8-16 hours | $2,000 - $5,000 |
| Network intrusion investigation | 40-80 hours | $10,000 - $25,000 |
| Data breach with exfiltration | 80-200 hours | $25,000 - $75,000 |
| Ransomware with negotiation | 100+ hours | $30,000 - $100,000+ |
Legal and Compliance Costs
Security incidents involving personal data trigger legal obligations. You may need legal counsel to navigate notification requirements, regulatory inquiries, and potential litigation.
Legal Service Costs
- Initial consultation and advice: $2,000-5,000
- Breach notification letter drafting: $3,000-8,000
- Regulatory response: $5,000-25,000
- Litigation defense: $50,000-500,000+
Notification deadlines: GDPR requires breach notification within 72 hours. Many US state laws require notification within 30-60 days. Missing deadlines can result in additional fines and legal exposure.
Customer Notification Costs
When personal data is compromised, you typically must notify affected individuals. This involves more than just sending emails.
Reducing Incident Response Costs
Have an Incident Response Plan
Organizations with tested incident response plans reduce containment time by 50% and total costs by 30%. A basic plan costs nothing but time to create and dramatically improves response efficiency.
Maintain Good Logs
Forensic investigators spend significant time reconstructing events. Good logging reduces investigation time. Centralized logging with at least 90 days retention can cut forensic costs by 40%.
Consider an IR Retainer
Annual retainers of $5,000-15,000 guarantee quick response and typically include 20-40 hours of incident response at no additional cost. For startups handling sensitive data, the peace of mind and guaranteed availability is worth the investment.
Train Your Team
First responder actions significantly impact incident outcomes. Training key staff on evidence preservation, initial containment, and escalation procedures prevents mistakes that increase costs and damage.
Prevention ROI: Every $1 spent on incident response preparation saves $2-3 during actual incidents. A $5,000 investment in planning, training, and tooling can reduce a $50,000 incident to $25,000.
How much does incident response cost?
Incident response costs range from $10,000 for minor incidents to $100,000+ for major breaches. This includes forensic investigation ($150-500/hour), containment and remediation, legal consultation, customer notification, and potential regulatory requirements.
Do I need external incident response services?
For most startups, yes. External IR firms bring specialized tools, experience, and objectivity that internal teams lack. They also provide documentation that may be required for insurance claims, legal proceedings, or regulatory compliance.
How long does incident response take?
Initial containment takes hours to days. Full investigation typically takes 2-6 weeks. Complete remediation and recovery can extend to months. The longer an incident goes undetected before response, the more expensive and time-consuming the response becomes.
Will cyber insurance cover incident response costs?
Most cyber insurance policies cover incident response costs, including forensics, legal fees, and notification expenses. However, coverage limits and deductibles vary. Some policies require using specific IR firms from their approved vendor list.
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