Loss ratios in the cyber insurance world have skyrocketed in recent years – surging 400% year over year. They have hit 70% of paid premiums, which some industry commentators are saying is unsustainable.
Previously, standard policy was to “pay the ransom,” but this attitude may be changing. “The ransomware groups got way too greedy too quickly. So the cost-benefit equation the insurers initially used to figure out whether or not they should pay a ransom — it’s just not there anymore,” said Fabian Wosar, CTO of Emsisoft, a cybersecurity firm that specializes in ransomware.
Determining how much insurance companies have is standard operating procedure for would be data kidnappers – either by obtaining the information as part of their attack or comparing the company size to payouts made by others. More sophisticated criminals have penetrated insurers to determine how much coverage clients have before attacking those clients.
However, some insurers are now no longer reimbursing ransoms. Insurer AXA announced that it will no longer reimburse for ransoms. Global total ransom in 2020 was hat least $18 billion.
Insurance costs have mounted in recent years, rising nearly 40% year-over-year.
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