The increasing number of networked devices and people online has heightened the chances of facing cyber threats. Anyone on the internet is susceptible to cyber crimes, making risk management extremely necessary. Case in point, cyber extortion coverage has become paramount to make sure that you are protected from the most dangerous of online threats.
Getting comprehensive cyber insurance coverage has never been more necessary, given the startling statistics of computer security today. The pandemic has likewise caused more and more people to rely on their devices for business and store data on the cloud, while possibly overlooking vulnerabilities on their computer system.
Contrary to popular belief, over half of all cyberattacks that occur target small-to-medium-sized businesses. Cybersecurity expert Scott Schober has authored a number of books on the matter and has warned that the 30 million small businesses in the United States must protect themselves against these risks. 60% of these businesses will shut down due to an attack within six months of its occurrence.
Cyber extortion is one particularly insidious type of cybercrime that anyone can fall for. Extortionists will threaten to impair a computer system or network and possibly leak pertinent data or intellectual property if their demand for ransom is not met.
Read on to discover more about cyber extortion coverage, and why it matters for every business.
Cyber extortion can be especially tricky because there is not always a guarantee that attackers will not manipulate or sell the stolen data in the future, whether or not you meet their extortion demands. Cyber extortion insurance will cover individuals against potential threats regarding attacks on their computer systems.
Coverage will encompass any local, cross-border, or international cybercrime or extortion event. It will also cover the costs associated with the investigation behind the attack, the potential costs to meet the cyber extortion ransom, negotiations of professionals, and preventive measures against future data breaches.
Cybercriminals have become more and more strategic with their battle strategies when infiltrating a network. We've listed the most common examples of cyber extortion so you can better protect your company:
Ransomware is one of the most prevalent forms of attacks. It is a type of malware that steals sensitive data, holding it hostage until a demand is met. Often, attackers will trick you into clicking a link that will trigger it to spread throughout your entire network.
Your servers and company data will be encrypted, thus blocking your access until you meet the extortion demand. Cybercriminals will only give you access when you pay them for a decryption key.
With a DDoS attack, cybercriminals make use of a network of devices that they have infected to flood your entire server. They do this with the purpose of disrupting your regular traffic. Attackers use IoT devices that are compromised by malware to control their attacks remotely.
Ransomware is a manifestation of cyber extortion as it is a common strategy deployed by cybercriminals. It is important to note that cyber exposures for this encompass any computer, smartphone, or tablet. The risk occurs when you unknowingly download malware through email attachments, click on malicious links or ads, or find yourself on a website that has been compromised.
To put it simply, any and every business needs cyber liability insurance. All businesses rely on technology services for their operations, thus making the need for policies that extend to cover recovery from cyberattacks, data breaches, or viruses necessary for risk management. They often include coverage for both first- and third-party damages.
Policies for cyber liability insurance may include reimbursement for the following as well:
The process for claiming your insurance may depend on your provider, but usually, you must write your complaint and immediately file it with law enforcement. They typically review the case, after you have supplied them with all relevant documents and information.
Costs for a cyber insurance policy are largely dependent on the nature of your business. On average, cyber insurance can cost roughly $1,500 annually. This is for coverage worth $1 million and a deductible of $10,000.
This figure will change depending on other variables, such as the size of your business, risks associated with your business, business revenue, the sensitivity of data (i.e. credit card information, Social Security numbers, etc), and term indicated on your policies.
Cyber insurance policies do not typically cover the following costs associated with a cyber event: potential profits lost to intellectual property theft, potential loss of value, and betterment (an upgrade in an internal technology system after a cyber event that incurs a cost).
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.
One to two weeks is a common time frame for recovery executed by an experienced team. This timeframe is typically required in order to successfully execute data restoration and keep up with the demands of recovering from cyberattacks like malware or ransomware.
The FBI has warned against paying a ransom for hackers. Paying the wrong people only encourages them to launch more attacks and provides an alluring opportunity for other criminals looking to make money from such crimes.
The FBI's Internet Crime Complaint Center (IC3) documented 43,101 cases of online extortion in 2019. Victims suffered losses of $107.5 million due to these incidents that were reported.
Anyone can be a victim of cyber extortion and other similar crimes. Aside from taking the proper precautions— backing up your data, updating security patches, and training employees—investing hard-earned money in a comprehensive cyber insurance policy will always be worth it.
You will not only protect your entire network and information security but prevent grave losses that could lead to business shutdowns. If you want to learn more, contact Assured Standard today!
