A research carried out by UK based Insurance company named CFC Underwriting says that ransomware attacks now account for almost a quarter of insurance claims. The data compiled as a report by the insurer says that a year ago, ransomware accounted for just over a tenth of cyber insurance claims. But now the figure has almost surged by 30%.
Graeme Newman, the Chief Innovation Officer at CFC views that sophistication employed by hackers in cyberspace is not only making things difficult for companies but is also putting a lot of stress on insurers offering cyber insurance schemes.
Newman adds that four years ago the cyber crime was easy to detect and criminals could be easily tracked down by law enforcement. But now, cyber attacks such as ransomware are incredibly hard to trace and chances of hackers being caught are becoming next to impossible.
On an additional note, cyber insurance used to traditionally circle around data breaches till a few years ago. But now, Newman said that such claims had started to level off with ransomware.
For example, early this month, businesses around the world were hit with a digital virus called Wanna cry ransomware. Till date, law enforcement agencies could not track down the hackers who launched the attack. But found that the malware exploited a flaw in Windows operating system’s security settings.
Technically speaking, the said malware encrypts its victim’s database and holds data until a ransom is paid to the malware developer/hacker.
Mr. Graeme said that Wanna cry victims were more in North America when compared to the UK. And CFC holds a lot of insurance policyholders from the American region when compared to the European continent.
So, did Wanna cry outbreak prove expensive to the company or the entire cyber insurance industry….?
Probably not, says Newman. He said that his company CFC had five times more claims notified for other versions of malware in a week after WannaCry. He added that Wanna cry attack has proved good for businesses offering cyber insurance schemes.
For example, inquiries received by CFC Underwriting for cyber insurance claims were 30 percent higher in a week after the attack than in the week before, and orders rose by 40%. On an average, the CFC’s cyber claims can range from £10,000 to £50,000 for small and medium companies. As much of it is utilized to hire expertise to do an IT systems clean up rather than pay the ransom demands.
Newman is sure that the same percentage hike would have been observed by the entire cyber insurance industry operating across the globe.
Have something to share with the world on the influence of ransomware on the cyber insurance industry?
Then feel free to do so through the comments section below.
