Why are Cybersecurity Insurance Claims Rising?

Cybersecurity insurance protects businesses in the event of online attacks. Insurance providers can absorb a considerable amount of the impact, allowing companies to recover faster and get back on track after experiencing a cyber breach. Recent data shows an alarming rise in the cybersecurity claims made by businesses across various industries around the world.

Let’s try to figure out why this is happening.

The Upsurge of Cyber Claims for Cybersecurity Insurance

With continuous and rapid technological developments, online threats have also advanced considerably. Social engineering and ransomware attacks have risen dramatically. As a business owner, you must understand what has been happening to protect your company from impending threats.

Pandemic-Related Threats

The world might be recovering from the pandemic, but the coronavirus has put us at risks beyond physical health. Millions of people have shifted to a work-from-home arrangement, which helped stop the spreading of the COVID-19 virus. However, the remote setup made it easier for cybercriminals to do their job.

During the pandemic, most people were online most of the day, either for work, for school, or stuck at home with nothing else to do. As the remote population ballooned, so did the number of unprotected home-based employees. The companies they worked for became much more vulnerable to disastrous attacks.

A New Approach to Ransomware Involving Cybersecurity Insurance

Ransomware is a type of malware that makes a network inaccessible until the victim pays a ransom. Initially, hackers targeted individual users and small companies with this malicious software.

But recently, they have realized that they could earn more from big corporations willing and capable of paying any ransom amount. Some hackers have shifted their focus to providing ransomware as a service or RaaS to users who wish to launch an attack but do not have the know-how. With easier access, it’s no surprise that more businesses and individuals are becoming victims and filing claims with their cybersecurity insurance providers.

Social Engineering Strategies

Many current cybersecurity claims stem from these new social engineering attacks. These attacks come in many forms, such as phishing, baiting, scareware, pretexting, and many more. It’s interesting how social engineering tactics produce so many victims when it is one of the easiest cyberattacks to identify and avoid.

Can You Lower the Incidence of Cyber Claims?

Let us be clear that all businesses need a sound cybersecurity insurance policy. Good insurance coverage will give you the protection and assistance you need in case of a cyberattack on your business. Everyone would like not to be a victim of an online attack, but that’s not today’s reality.

As a business owner, you need to train everyone in your organization to identify and thwart an attack before it happens. You should regularly test your employees with an employee readiness check. You might be shocked at the results.

For more about cybersecurity insurance, online safety strategies, and employee training, check out our eBook entitled The Ultimate Guide to Finding and Hiring a Superstar IT Solutions Provider for Businesses and learn tons of valuable tips on how to keep your business protected. If you have any other concerns about cybersecurity insurance, please give us a call!