Small business owners may not realize that their companies are only as secure as the last e-mail they sent. It is for good reason that small businesses are being held responsible for the information they share about their customers through online applications and e-mail. As more business is done online, the pool of information increases, and so does the risk of security breaches. As Internet privacy regulations continue to evolve, small businesses need to pay attention to compliance.

"Encrypting" e-mail is one way to guard against the e-mail you send being accessed by unwanted parties. But how do you know if encryption is right for you? If you can answer yes to one or both of the points below, your business should consider encryption services:

Do you share confidential information about your business or customers by e-mail? This includes account numbers, dates of birth, or highly sensitive internal strategy documents.

Do you operate in a regulated industry, such as health care or financial services, or in a state with privacy regulations such as Massachusetts or California?

The average cost of a data-loss incident for U.S. organizations was $6.75 million in 2009, or $204 per compromised record. In the event of a breach of confidential information, companies are financially accountable, and no business wants to pay the fines. Businesses need to know they have control of the communications coming and going from their companies.

This article was written by Jonathan McCormick and published in Bloomberg Businessweek magazine.