Encryption Vendor BitArmor Offers No-Data Breach Guarantee

BitArmor is offering customers a refund if they are compromised in a data breach. Some speculate the deal may spark similar moves from competitors.

Encryption vendor BitArmor is putting its money where its mouth is when it comes to protecting data.

The vendor announced Jan. 15 it would refund the purchase price of its DataControl software to customers who experience a data breach. DataControl combines full disk encryption for laptops and persistent file encryption using Smart Tag technology to protect information everywhere the data travels.

The deal is a rare move in the world of IT security, where some have called for guarantees in the event of data breaches.

"We decided to offer the guarantee because we're confident that our software will do what it's supposed to do," said Patrick McGregor, the company's CEO. "In fact, we've worked with a number of government agencies in recent months - local, state and federal - and their forensics labs have dug into our software using very sophisticated tools. They haven't been able to break our software, and we're proud of that."

Dubbing it the BitArmor No-Breach Guarantee, the refund kicks in if a BitArmor-protected enterprise falls victim to a data breach that specifically circumvents BitArmor controls. Under the terms of the deal, a forensic investigator would have to find the breach occurred because BitArmor's software failed.

"Obviously, if data is not protected with BitArmor software, we can't vouch for the safety of that data," McGregor said. "We do not have onerous terms - you can read them from our site - they are common sense. We launched this program because we believe that our product can back it up."

The deal comes as the number of data breaches and exposures continues to rise. Earlier this month, the Identity Theft Resource Center estimated the amount of data records exposed in publicly-disclosed breaches last year was roughly 35.7 million.

"The BitArmor no-breach guarantee might sound gimmicky but after thinking it through, it's quite a bold statement about its confidence in its product," said Nick Selby, an analyst with The 451 Group, in a statement. "We expect that competitors will be forced to put their money where BitArmor's mouth is - this has the potential to be a data security product guarantee standard."