According to a new report by Coalition, one of the nation’s cyber insurance providers, ransomware attacks make up 41% of all cyber insurance claims in the first half of 2020. Unfortunately, that’s the good news. That number is actually down by 18% since 2019. The bad news? While the frequency of ransomware attacks are down, the severity of attacks has risen dramatically.
In particular, cyber criminals are starting to demand more and more money from their victims. According to Coalition, ransomware claims are in general 2.5x higher than other cyber insurance claims across all industries. And demands continue to increase in dramatic fashion. Coalition’s report states that the average ransom demand increased 100% since 2019 and has already risen an additional 47% between Q1 and Q2 of this year.
Source: Coalition
What’s more, not only have ransomware demands increased, but the attacks themselves are becoming more and more sophisticated. While traditional ransomware attackers encrypt data within the target’s network, now they are actually stealing the data and threatening to leak the information if a payment isn’t made, as happened to the cloud services firm Blackbaud this summer. This tactic may in part account for the of the increases in demands, as organization’s may be more motivated to pay in order to keep the incident private. However, there is no guarantee that paying will stop the attackers from leaking the data anyway.
While the Coalition report shows that more and more businesses are turning to cyber insurance to help with ransomware attacks, relying on insurance should not be your solution. Sure, insurance may help pay the cost of the ransom, but if attacks know insurance companies will pay up, they may start to feel confident asking for larger and larger amounts of money. The FBI also discourages businesses from paying demands.
Instead, the best response is prevention. Even simple solutions like multi-factor authentication and good password management can help dramatically. In addition, the report found that 60% of claims are for attacks that originated as a phishing or other social engineering scams. Investing in effective cyber awareness training can help prevent attacks from occurring in the first place. Like with most things related to cybersecurity, it’s always better to take action now rather than wait for the worst to happen.