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    Everything You Need to Know About Ransomware Insurance

    Everything You Need to Know About Ransomware Insurance

    As proven over the pandemic, the rate of organizations adapting to the internet has increased over the past decade. This has undoubtedly given us many of our modern conveniences but it has also presented another opportunity for cybercriminals to attack.

    So much so that as early as 2018, cybercrime saw a 350% increase in activity. Ransomware attacks fall under this category and have proven to be a significant risk to watch out for.

    How Does Ransomware Cybersecurity Insurance Work?

    Cybersecurity insurance is the natural direction insurance agencies took when cyber crime's rampancy was first noticed. These insurance policies ideally consider how these attacks happen and what the threat is to the client, which can include random demands the victim has to deal with.

    The industry has been seeing a lot of growth in recent years and is seen to exceed $20 billion by 2025, evidence of the effects of the reported frequent cyberattacks. Consider this a wise risk management choice for those considering the threats of ransomware and cyber extortion.

    What Are the Four Categories of Cyber and Privacy Insurance?

    Network Security and Privacy Liability

    Network Security coverage involves first-party costs as a result of a failure in your computer system or network's security. This is seen as the most essential for most businesses as part of their general risk management.

    Policies that include this coverage factor considers the risk of ransomware attacks, cyber extortion, malware infection, and data breaches among others. Insurance claims can be made to address repair costs that were a result of those incidents.

    Privacy liability, on the other hand, focuses on the high-risk nature of stored data. This includes social security numbers and home addresses of the organizations' clients and members. These policies cover cyber incidents and privacy law violations resulting from those cyber incidents.

    Network Business Interruption

    Similar to how a physical store might suffer from operational delays in cases of robbery, policies that come network interruption can cover expenses resulting from a ransomware attack or ransom payment.

    This includes the possibility of your network going down as a result of a cyber attack on your network provider. Claims can be made to cover fixed expenses as well as extra costs credited to your business during your organizations' downtime.

    Media Liability

    Media Liability gives more attention to those involved with social media advertising, online advertising, and printed advertising. It provides coverage in cases of copyright infringement due to a cyber incident.

    How can this happen? In some cases, ransomware is programmed to release company data publicly. In these times, copyright infringement might come as a result of this release, further adding to your troubles.

    Errors and Omissions

    This coverage considers the risk of malware and ransomware affecting your professional obligations. This includes cases where errors were made and tasks were unfinished during the period of the company's downtime.

    This coverage preemptively addresses any cases of demands due to negligence on your part. Any costs resulting from customer demands or attorney expenses should be included.

    What Happens If You Don't Pay Ransomware?

    That would depend on the ransom demand of that specific ransomware. Of course, these could happen simultaneously too.

    Sometimes the ransom demand involves money, these days usually done through Bitcoin. These demands can range from $200 to $4,000.

    Others may try other forms of cyber extortion, putting your company at risk in the process. Assuming you fulfill the ransom payment or conditions, the individual attacking you will return your access to your data.

    In some cases though, the hackers delete your files even before failure of payment. Others might release the data publicly, which is a risk for businesses needing privacy for their work. Businesses suffering from these kinds of attacks have often folded up as a result.

    When Should You Get Cyber Insurance for Your Business?

    Right away. Ransomware attacks, and cyberattacks in general, can happen to businesses of any size. Ransomware attacks don't necessarily have to be a deliberate attack done by the code's developer. These days, ransomware can now be offered as rented assets, called Ransomware-as-a-Service (RaaS).

    With that said, it is best to address the threat of a possible cyber attack. It doesn't take much to be infected, as one employee carelessly downloading files off the internet could cause organizations to be victims of ransomware demands.

    How Much Does Cyber Security Insurance Cost? And How Are Cyber Insurance Premiums Calculated?

    The insurance industry follows its tested method of factoring in any risks that your business will carry with it. This is why hackers in the past have targeted hospitals and schools in order to access sensitive information on their victims.

    That said, if your company stores records of your client's personal information, the insurer would see that as an added risk. Compiling all these risks will result in the premium of your insurance policy.

    Generally, you can expect to spend an average of $1,458 per year for cyber coverage. It's no small price but should provide you with a level of protection from a ransomware attack.

    What Is the Best Cyber Insurance?

    The best cyber policy for your business will depend on the kind of coverage your business needs as well as what the insurers offer you. Costs will also come into play as not everyone can afford insurance policies.

    Your business will still have a few you can run to if you're in a hurry. Seeing as how most organizations have a computer system, you can expect that much of the well-established insurance providers have adapted to this practice.

    Frequently Asked Questions

    What is not covered by cyber insurance?

    These policies do not typically cover the following costs associated with a cyber event: potential profits lost to intellectual property theft, loss of value due to theft of your intellectual property, and betterment (an upgrade in internal technology system after a cyber event that incurs a cost).

    Can ransomware spread through WiFi?

    Yes. Ransomware is a type of virus that can spread across the network to your computer. Once infected, it will not just affect the hard drive and mapped files on your system but also cause disruptions in business by taking down entire networks.

    What is the waiting period for cyber insurance?

    They usually have a waiting period between 6 and 24 hours before recovery can begin.

    What is the difference between cybersecurity insurance and data breach insurance?

    Data breach insurance ensures your business is prepared to respond quickly and efficiently in the event of a security data leak. Cyber liability insurance can be more comprehensive, with policies potentially covering cyberattacks that leave you with significant financial losses.

    Can you remove ransomware?

    While it may be possible to remove the ransomware malware from an infected system, restoring encrypted files is much more difficult. Unless a ransom has been paid and you have backup copies of your data (or the author made mistakes in encrypting them), there's no way that your files can be recovered.

    These reports of ransomware attacks should give you an idea of what you're up against. Don't let yourself be a victim of these ransom demands. You can learn more about cyber ransom, cybersecurity, and cyber insurance on our site, Assured Standard, today to give yourself an advantage.

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    Assured Standard will protect your business with the right insurance, depending on your needs. Now more than ever, it’s crucial to have the right general liability insurance experts on your side. Protecting the future of your business starts today.
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