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Why Are Cyber Insurance Rates Rising.

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Posted by Mike Pape - 01 September, 2021

At the root of many damaging cybersecurity incidents, you’ll find phishing. 90% of incidents that end in a data breach start with a phishing email. Researchers at leading organizations have sounded the alarm about phishing forever, but many organizations still fail to take the threat seriously to their detriment. As phishing rates worldwide continue to climb, there’s a new impetus for businesses to fight back against phishing.

While it may not seem like it on the surface, phishing is a complex hazard for businesses to navigate. One reason for that complexity is that phishing is a rapidly evolving area of cybercrime. The bad guys are always trying out new scams. Researchers at the University of Maryland estimate that cybercriminals launch a new cyberattack like phishing every 39 seconds. These statistics offer a starting point when considering the way that phishing impacts the business world right now.

Phishing Quick Hits

  • 94% of malware is delivered by email
  • More than 80% of reported security incidents are phishing-related
  • 40% of phishing messages aren’t caught by conventional security or an SEG
  • One-fifth of employees in a 2020 survey fell for phishing tricks and interacted with spurious emails
  • 45% of employees click emails they consider to be suspicious “just in case it’s important.”

The epic rise in phishing-related data breaches is also behind the severe increase in pricing for cyber insurance, up by 56% in the US. Insurance industry experts point to ransomware as the cause of such steep increases. Ransomware cyber insurance claims worldwide clocked a 260% increase in 2020 as cybercriminals turned up the heat. Many insurers are placing restrictions on the coverage that companies can buy for phishing-related disasters. These restrictions are based on the frequency and severity of losses related to ransomware. Insurance giants like AXA recently announced that they would no longer underwrite cyber insurance policies to reimburse companies for ransomware payments after cyber attacks.

The two most prevalent requirements I have been seeing from Wisconsin insurance providers are for 2-Factor Authentication and Security Awareness Training. I’d encourage you to talk to your provider today – I see swift movement in the industry to require additional steps, or premiums will skyrocket.

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Resource References:

6 Factors Causing Cyber Insurance Rates to Increase | Travelers Insurance

134 Cybersecurity Statistics and Trends for 2021 | Varonis

Top cybersecurity facts, figures and statistics | CSO Online

Nearly Half of Phishing Emails Escape Traditional Filters - Graphus

Stop Dangerous Employee Email Interactions with Graphus - Graphus

AI is Your Secret Weapon Against Social Engineering - Graphus

Posted by Mike Pape

Mike Pape is an experienced IT and cybersecurity executive who helps businesses uncover their cybersecurity challenges and develop a comprehensive security plan. He understands cybersecurity solutions around compliance, governance, data protection, and ransomware mitigation. His deep understanding of business operations and technology gives him the unique ability to develop business security strategies that truly protect companies against cyber threats.

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Topics: Cybersecurity

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