If You’re Hit with Ransomware, You’ll Want Cyber Insurance

Posted by Grant Patten on Aug 6, 2020 6:42:33 AM

Small Business Owners: If You’re Hit with Ransomware, You’ll Want Cyber Insurance

Ransomware Cyber Insurance Woman UpsetSource: Royalty-free stock photo ID: 659365795 | Shutterstock

Don’t think a ransomware hack could happen to your small business? Well, think again!

STATISTIC: Cybersecurity Ventures estimates that global ransomware damage costs will reach $20 billion USD by 2021, an increase from their estimated damages of $11.5B in 2019 and $8B in 2018.

STATISTIC: Ransomware is expected to attack a business every 11 seconds by the end of 2021.

Perhaps the fastest-growing cybersecurity threat in Canada right now is ransomware, a type of malware (malicious software) that uses sophisticated encryption to block access to a computer, network and/or data until a sum of money is paid.

Ransoms typically range from $800 to $5,000 (but sometimes much more), as most cybercriminals are aware that a business can’t operate without its computer system or important client data and the fee is just manageable enough for most companies to pay.

Just look at the below real-life examples of ransomware attacks on small businesses to see how real this threat is:

Toronto Accounting Firm Ransomware Hack (2020) / who does ransomware target?

An accounting firm based in Toronto was hit by ransomware in 2020. The ransomware encrypted various confidential reports, including an expense form from one of the firm’s main partners.

Additionally, the hackers stole some documents and auctioned them off on the dark web. Typically, hackers auction off such data to increase pressure on victim companies to pay up for decryption keys.

With cyber insurance, theft and fraud coverage is included to cover destruction or loss of digital data resulting from a criminal cyber event.

Toronto Dental Clinic Ransomware Hack (2019) / who does ransomware target?

Also in 2019, an anonymous Toronto dental clinic was hit by the Ryuk ransomware attack:

Ryuk ransomware noteThis note, which CBC printed out, was left on the clinic’s computers. (Submitted by clinic)
Source: cbc.ca

The ransomware locked staff out of digital files for at least a day and they had to take notes on paper. The dentist said files on 19 out of the clinic's 22 computers became encrypted.

The hacker initially demanded nine bitcoins (nearly $100,000) to decrypt the dental clinic’s files, but later increased that price to 15 bitcoins ($165,000). The dentist opted not to pay the ransom because they had a good backup in place.

With cyber liability insurance, the cost of a forensic investigation may be included to determine how, exactly, a hack occurred, and to assess the impact of the attack. (Determination of whether or not a forensic investigation will be triggered depends on the circumstances of each claim.)

Montreal Insurance Brokerage Ransomware Hack (2016) / who does ransomware target?

An insurance brokerage based in Montreal experienced a ransomware attack in early 2016. A mysterious error message began appearing on their system: “The system cannot access the database.” Upon consulting their IT firm, it was discovered that ransomware had been installed onto the brokerage’s system through an email attachment that an unsuspecting employee had opened. The ransomware had encrypted all the brokerage’s client data, including emails, PDFs and other policy documents, rendering the data completely inaccessible until a sum of money was paid – $2,300 CAD.

“To deal with the ransomware, I called my tech support team and we had backed up our data, but unfortunately it wasn’t completely up-to-date; the latest backup was six weeks in the past,” recalled the brokerage President. “It was important for us to retrieve the latest data, so I made the difficult decision to pay the ransom. It came down to paying $2,300 or losing six weeks of work, so I chose the former.”

Why ransomware hackers use Bitcoin:

The ransomware attacker insisted the brokerage pay via the digital currency system Bitcoin in order to make the payment untraceable. Due to the elaborate software architecture that stands behind this currency, which uses cryptography to secure transactions, it is extremely difficult to find out who is actually exchanging the Bitcoins, much less what they’re selling.

Ransomware Prevention | Ransomware Remediation | Ransomware Protection Tips

So, what should other companies do to avoid the same thorny situations as mentioned in the above real-life examples? Maintaining an on-site data backup solution is certainly prudent; however, these backups must be frequent and thorough to be effective, and relying solely on local backups is generally inadvisable. Companies could also implement a backup in the cloud, which means sending copies of data to at least one secure off-site server. Leaders in the cloud backup space include Dropbox, Amazon Web Services and Microsoft Azure.

But, of course, the best approach is to avoid being infected with ransomware in the first place. Educate employees about how to recognize suspicious emails. As the primary installation source of ransomware is online advertisements, according to security firm Symantec, be careful about clicking on Internet ads.

Most software products have different authorization levels that can be customized; business owners should take advantage of this feature to create different access levels for employees, giving each employee access only to the areas they need for their work, and restricting them from the others.

And, of course, don’t neglect the basics: make sure your antivirus software is regularly updated and your systems are regularly patched. A multi-layered defense comprised of a next-generation firewall (NGFW) will reduce the number of successful ransomware attacks on your internal network. NGFWs can cost under $1,000 and leaders in this space include Palo Alto, Cisco, Barracuda and Juniper.

Get Ransomware Insurance / Cyber Insurance / Cyber Liability Insurance / Cyber Risk Insurance / Hack Insurance

Front Row’s cyber liability insurance policy includes Extortion & Ransomware coverage for costs associated with payments to those who threaten to disclose sensitive information.

Protect your data and your clients' data. Front Row's cyber insurance policy is available online in 5 minutes; premiums start at $300 CAD. Platinum coverage is $800 CAD. (Prices subject to change) Up to $1,000,000 of protection is available.

90% of small businesses in Canada do not have Cyber Insurance: take a few minutes to protect your business that has taken you so long to establish.

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About: Front Row Insurance Brokers Inc. is an independent insurance broker that provides cyber insurance for a very low cost. Should a claim occur, Front Row works diligently with clients and insurers to expedite payment of claims. Front Row has offices in Vancouver, Toronto, Montreal and Halifax.

Citations:

https://cybersecurityventures.com/global-ransomware-damage-costs-predicted-to-reach-20-billion-usd-by-2021/

https://www.cbc.ca/news/technology/more-ransomware-canada-1.5317871

https://www.csio.com/article/one-broker%E2%80%99s-ransomware-scare

https://www.itworldcanada.com/article/toronto-accounting-firm-hit-by-ransomware/432049

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