What Is Ransomware? | Foxquilt Insurance

BUSINESS INSURANCE


Feb 25, 2021

Learn how ransomware can harm your business

You're working on your computer when text suddenly flashes across your screen; it says you can't access the files on your computer unless you pay a price. Just like that, you're a victim of ransomware. But what is ransomware? Ransomware is a type of malware (software specifically designed to disrupt, damage, or gain unauthorized access to a computer system) that infects your computer system and network, essentially taking it hostage. It encrypts files so you can't access them unless you hand over a ransom.

How can ransomware get into your system?

  1. Via URL/HyperLink – You might've clicked a link sent from someone you didn't know

  1. Bogus Patch Upgrade – Maybe you downloaded a fake update for software in your operating system

It's important to know that hackers don't need you to download their malware to cause problems. They only need to find a hole in your computer's defenses so they can lock it down. It also doesn't just affect IT or computer-centric businesses; any business that uses a computer system as part of its day-to-day dealings is vulnerable. In 2020, that means Every. Single. Business.

That's what happened in 2019 in the case of three well-known Ontario hospitals. Hackers exploited a vulnerability in their respective computer networks, collecting vital and classified information about the organization and its perceived ability to pay a ransom.

The implanted virus then locked a significant number of files, demanding the network owner pay calculated sums of money to make them accessible once more.

This kind of attack isn't new. It's been around since the early 2000s, but ransomware really took off after the invention of cryptocurrencies, the internet currencies that can be swapped anonymously online.

Did you know over 400 ransomware attacks happen globally every day, with the frequency increasing constantly?

If you consider your business to be a vital service by any possible definition, you're particularly at risk because cyber criminals know that the smallest disruption to your systems can cause a serious crisis. Especially when you think about how much more reliant we've become on technology in 2020, there's never been more risk to companies.

So, what do you do, now that you know you're infected with ransomware?

Well, you could pay the hackers and hope they make good on their promise to unlock your file, but some say this gives hackers an incentive to strike again; there's also the risk they'll just ask for even more money.

How can you protect your business from ransomware?

  1. Hire a cybersecurity expert – Have them try to remove the ransomware themselves

  1. Wipe your machine clean – Start again from whatever files you have backed up

  1. Keep your system up to date – Going forward, remember to patch your software accurately

  1. Keep files on an external hard drive – This a super simple way of keeping them safe

  1. Don't click links you're not familiar with – This includes opening email attachments from senders you don't know

  1. Use a password manager – This makes it harder for hackers to figure out your various sets of log-in credentials

  1. Make sure you have adequate Cyber Insurance coverage – This won't prevent a ransomware event from occurring, but it will help to financially cover some, if not all, of the cost of any ensuing and related losses

Coverage for losses associated with ransomware is available within most Cyber and Privacy Insurance policies under an insuring agreement most often termed "Cyber-Extortion coverage."

The items it covers include:

(1) money to pay ransom demands,

(2) the cost of hiring experts to negotiate with hackers, and

(3) the cost of computer forensics experts who can determine how hackers gained access to the insured's computer system and then make recommendations on preventing future incursions.

The threat of this type of risk is so real and prevalent now, as new cases grow in both frequency and severity, that it's imperative to consult your insurance broker on how to best approach the genuine threat of an attack and ensure you're protected.

The cost of Cyber Insurance can range from negligible to significant, depending on the size of your business and the type of industry you're in, but the cost of not having this type of data protection in place could be even more devastating. Our team of experts at Foxquilt can help you figure out the right Cyber Insurance policy for your unique business and can provide you with a quote tailored for your business. Get started on your quote today.

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