The shifting cyber risk landscape over the past eighteen months – especially the explosion of ransomware attacks — has put a spotlight on what businesses and governments are doing about cybersecurity risk and what role does or could cyber insurance play – not only as a risk transfer vehicle, but as an enabler of improved risk management practices. As of early 2021 the total global premiums for cyber insurance have reach over $5 billion, but the truth is cyber insurance is still a very new industry, and the role it can play in mitigating cyber risk is has been an open question for a few years.
However, according to a new report by the UK-based security research institute RUSI, the role of cyber insurance as a risk mitigation tool is still pretty limited. One big challenge is that both issuers and insureds too often view cyber insurance as a replacement for actual cybersecurity policies and procedures. Cyber insurance doesn’t mean that you won’t get hacked just like having fire insurance doesn’t mean your house won’t ever burn down. This challenge has most recently been playing out with questions surrounding ransomware payments. Today, many cyber insurance policies include payments for ransom demands. However, this raises the concern that such practices are actually fueling the recent spike in ransomware attacks. In fact, some evidence suggests ransomware attackers are specifically targeting companies with cyber insurance and tailor their demands to the high-end of what those policies will cover.
That said, cyber insurance still has a role to play — but it doesn’t replace the other value chains within the broader risk mitigation process . Like with most insurance, it’s not designed to prevent or eliminate risk, but rather to transfer risk as a last line of defense. In the RUSI report, many of the experts interviewed cite post-incident services as one of the main benefits of having cyber insurance. From incident response to forensic analysis, cyber insurance can be extremely useful for maintaining business continuity following a cyber incident. This is even more important for small businesses who might not have internal teams and the expertise to carry out a post-incident response swiftly and effectively. However, there is a lot more to cyber security than how you respond to an incident. As RUSI’s report points out, right now cyber insurance is most effective as a tool for cyber resilience, but not risk mitigation.
What is important to understand is the need to properly place cyber insurance within your larger risk governance strategy. Cyber risk management is like putting together a puzzle with various shapes and sizes. From performing informed risk assessments, to maintaining strong systems controls, to creating a culture that values cybersecurity, there is a lot of factors that need to be pieced together in a way that aligns with your business context, strategy, and goals. Effective risk management includes a value change of activities and partners, including insurance, but relying on insurance along is not enough.
By now, you’ve almost certainly heard about ransomware — a form of cyber-attack in which hackers encrypt systems, steal data then demand a ransom payment to end the attack. While ransomware has been around for a while now, attackers have started setting their sights on bigger and bigger targets, gaining international media attention in the process.
But the reason businesses should be paying attention to ransomware is not because big corporations are shelling out millions of dollars in ransom payments. Instead, when you look at the bigger picture, small businesses are the ones who will continue to bear the brunt of these attacks. According to the Secretary of Homeland Security Alejandro Mayorkas, there has been a 300% increase in ransomware attacks in the past year and 50-70% of those attacks were directed against small and medium sized businesses. And while a cyberattack is tough for any businesses to recover from, the threat ransomware poses to small businesses is existential, with 60% of small businesses failing within 6 months of a cyber-attack.
Because the threat is so big and the stakes are so high, governing ransomware risk needs to be a top priority for small businesses. And in order to protect your organization, there are two vital areas that need to be focused on: systems controls and organizational culture.
1. Endpoint detection and response
Endpoint detection and response (EDR) is a type of security software that actively monitors endpoints like phones, laptops and other devices in order to identify any activity that could be malicious or threatening. Once a potential threat is identified, EDR will automatically respond by getting rid of or containing the threat and notifying your security or IT team. EDR is vital today in order to stay on top of potential threats and put a stop to them before they can cause any damage.
2. Hardening your RDP Ports
Remote Desktop protocol is a tool that allows someone to connect to a computer remotely. This can be useful, but more and more ransomware attackers are using RDP ports to gain access to victims’ systems. Organization that do not actively use RDP should therefore consider disabling the feature or limiting to users and devices that are not connected to public internet.
Having a back-up of your systems could allow you to regain access to your data without having to pay the ransom. However, it’s essential to have an effective back up strategy in order to ensure the attackers don’t steal your backups along with everything else. At minimum, at least one backup should be stored offsite. You should also utilize different credentials for each copy of your back-up. Finally, you should regularly test your back-ups to ensure you will be able to quickly and effectively get your systems online if an attack happens.
Lastly, using multi-factor authentication (MFA) is a simple yet powerful tool for stopping the bad guys from using stolen credentials. At minimum, any user accessing your network should be using MFA. In addition, all users with administrative privileges need to use MFA, whether they are accessing your network remotely or on premise.
Don’t Forget Culture
When it comes to governing ransomware risk, the best way to prevent attacks is to focus on creating a culture that incorporates cyber-secure behaviors into every day practices. However, the biggest issue many organizations face when creating a cybersecure culture is sustaining those behaviors overtime. In order to properly govern ransomware risk, behavior change requires 4 essential elements:
1. Consistent Communication
We get it, cybersecurity can be confusing. And as the threat landscape changes, so do our cybersecurity policies. That’s why it’s so important that business leadership consistently communicate with their employees about the behaviors you want to see.
2. Make it Easy
When thinking about the behaviors you want employees to adopt, it’s vital you make these behaviors as easy as possible to do. Everyone is being pulled in a million different directions at once, so if an employee has to take 10 minutes out of their day to figure out how to report a phish, they aren’t going to follow through. If, however, you provide a simple and easy-to-use process, you’re going to have a much easier time getting employees to adopt new behaviors.
3. Help People feel Successful
People want to feel like the work they are doing is making a difference. If they feel like what they are doing just doesn’t really matter all that much, there isn’t going to be much motivation to continue doing it. That’s why it’s so important to help people feel successful when they follow through on the behaviors you want to see. Providing positive feedback, for example, can go a long way towards creating behavior change. If your employees know their work is being recognized and feel it makes a difference, they will be much more likely to keep it up.
4.Walking the Walk
The above three elements for creating sustained behavior change have one thing in common: you. A leadership team can’t simply talk the talk. Change starts at the top and requires you and your leadership team take an active role ensuring these behaviors become a part of the organizational culture and value structure.
There’s no doubt that ransomware poses a big threat to small businesses, and the best thing you can do govern the risks of attack is focusing on creating a culture in which cybersecurity is valued and acted upon every single day.
Many of us check to see if our doors are locked before we go to bed. We might be pretty sure it’s already locked, but we know it’s worth double checking just in case. It’s common sense. That’s why it’s so surprising to see, according to a recent UK report, that only a third of businesses check their own cyber security locks by conducting a cyber risk assessment.
Throughout the report, there is a stark contrast between the amount of breaches companies are experiencing and the measures they are taking to prevent these breaches from happening. For example, the report found that nearly 40% of business surveyed reported at least one attack or breach within the past 12 months. What’s more, for many of these businesses, a breach is not a one and done experience. Half of the organizations that were attacked said they’ve experienced an attack once a month and a quarter of these businesses report attacks on a weekly basis.
If your home was being broken into on a weekly basis, you’d probably start double checking those locks. Yet, according to the report, businesses are not taking the necessary steps to protect themselves. In addition to the lack of cyber risk assessments, only 33% of businesses have a formal cyber security policy. And while phishing scams accounts for 83% of the attacks businesses reported, only 14% of businesses have conducted any sort of cyber awareness training within the past year.
In a blog post on the report, Phillip Virgo makes the important point that cybersecurity measures need to be considered within the context specific to a business’ size and industry. And he’s right, there is no one size fits all approach to cybersecurity. In order for any sort of protections to be useful, it’s vital those measures are not only suited to an organization’s size and industry, but also aligns with their specific business strategy.
At the same time, however, this doesn’t mean there aren’t steps every business should be taking to protect themselves and a risk assessment is a good way to start. Anything less isn’t just leaving your door unlocked, it’s leaving the door wide open with a welcome mat out front.
The prominence of ransomware within the already crowded cyber threat landscape has been in the headlines for the past few years. But what you won’t see in the headlines is the fact that small businesses are the ones bearing the brunt of the onslaught. Ransomware is a form of attack in which hackers encrypt or steal your data then demand a ransom before giving you back access. And, according to Coveware’s ransomware report for Q1 of 2021, 73%of all reported ransomware attacks this year targeted businesses with under 1,000 employees. Of course, there are plenty of large companies that have to deal with ransomware, but it’s high time we start looking for solutions to the very real threat that small businesses across the country are grappling with.
There are a number of reasons ransomware attackers focus their efforts on small businesses. For one, these attackers are opportunists. They’re not looking to crack the toughest systems, they’re looking for a quick buck. Since small businesses probably don’t have the sophisticated and expensive security tools in place that big corporations do, the bad guys see them as easy pickings.
Another big reason small businesses are targeted by ransomware is because the consequences of having their system’s shut down are far more costly for small businesses. According to Coveware, the average downtime following a ransomware attack is 23 days — up 10% from Q4 of 2020. Last year a small business in Kansas with only 8 computers was hit with ransomware and paid the hackers $150,000 for to regain control of their systems. Explaining why the company decided to pay the company’s CFO said, “If we don’t pay them, we don’t have a way out of this, and business just stops, so it’s quite a scary situation.” While cybersecurity experts tend to advice companies not to pay ransom, and new evidence shows 92% of companies never get their data back after paying, the stress, fear, and consequences of being down may be enough to give into the demands.
When it comes to ransomware and small businesses, it’s clear the stakes are high and only getting higher. It’s essential we start focusing our efforts on helping these businesses take reasonable and affordable steps that can help prevent attacks and protect their data.
To help, use the acronym R.A.N.S.O.M for 6 simple steps that can go a long way toward preventing and protecting your small business against ransomware:
Remote access protections and patching
Given the rise of remote work since the pandemic, hackers are increasingly using remote access to install malware. Having remote access protections in place is therefore essential for preventing an attack. Even simple steps like robust firewall settings and requiring the use of VPNs and adding Endpoint Detection and Response can go a long way to keeping attackers out.
In addition, hackers are constantly looking for vulnerabilities in the software we rely on to run our businesses. All those software updates may be annoying to deal with, but they often contain important security features that “patch up” known vulnerabilities. At the end of the day, if you’re using out of date software, you’re at an increased risk for attack.
Administrative privilege limits
Setting limits on administrative and access privileges is another important way to protect your data. Every employee should only have access to the systems and information they need to preform their work. Too many businesses give employees more access than they need. If a hacker gains access to one of your employee’s accounts and there aren’t access limits set, then the hackers can move freely through your systems, changing settings and accessing sensitive data
It’s important to keep different elements of your network separate from each other so you can control how information flows from one to the others. Similar to privilege limitations, this will help ensure that anyone who breaks into your systems can’t then use that access to move around your networks.
Security awareness training
Phishing and social engineering attacks are common ways attackers gain access to your systems and install ransomware. Unfortunately, phishing attacks are not something you can fix with a piece of software. Instead, its essential employees are provided with the training they need to spot and report any phish they come across. Sometimes it only takes one wrong click for the bad guys to worm their way in.
Offline backups and periodic testing
This is a big one. If you suffer a ransomware attack, having a backup of your systems may enable you to get you back up and running without having to pay or start over from scratch. However, when making backups it’s important to takes a few steps to ensure you can rely on them. For one, backups need to be stored offline in order to prevent hackers from gaining access to them as well. Second, it’s necessary to periodically test your backups to ensure they are working currently. You don’t want to be in the position of needing your backup only to find the whole thing is corrupted!
Finally, requiring multi-factor authentication can go a long way to prevent an attack. If an employee’s login credentials are stolen, MFA adds an additional layer of protection that may prevent the bad guys from getting into your systems.
In the wake of the recent SolarWinds hack, a vendor compromise that infected tightly protected government agencies, the Biden administration is reported to be planning a new cybersecurity executive order as early this week. While a National Security Council spokeswoman said no decision has been made on the final content of the executive order, among the measures being reported is a new requirement that any vendors working with federal government agencies must report any suspected breaches to those agencies.
While there have been multiple previous attempts to establish breach notification laws through congress, industry resistance has previously been successful in halting the bills from passing. But now, following the two, massive hacks of SolarWinds and Microsoft over the past few months, there may not be much vendors can do to stop it this time.
Along with the breach notification requirement, the planned cybersecurity executive order is reported to contain a series of additional security requirements for software and programs used by federal agencies. This may include requiring federal agencies to take small, but essential security measures such as the use multi-factor authentication and data encryption.
Overall, the executive order appears to create broader levels of transparency and communication between software vendors and government agencies regarding cybersecurity. For example, since many pieces of software now link directly to other programs and services, the order is reported to also require a “software bill of materials” that lays out what the software contains and what other services it connects to. According to Reuters, the order may also create a cybersecurity incident response board, encouraging communication between government agencies, vendors, and victims.
If Biden signs the executive order, this may be a the first step towards a more robust and efficient response to the increasing cyber threats government agencies are facing. According to Reuters, this may also open the door towards broader public disclosure legislation. By being transparent and openly sharing information, both government agencies and private organization will benefit by helping to identify and mitigate threats more quickly and effectively.