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Ransomware and FFT lead cyber insurance claims for 2022

Ransomware and fraudulent funds transfer (FFT) are the biggest causes of cyber loss in 2022, making up over 50 per cent of all cyber insurance claims as found in a new report.

user icon Daniel Croft
Thu, 08 Dec 2022
Ransomware and FFT lead cyber insurance claims for 2022
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FFT, which sees hackers use social engineering to trick employees, vendors or individuals to transfer funds into wrong accounts, leads claims at 28 per cent, while ransomware followed close at 23 per cent, according to leading Smart Cyber Insurance provider Corvus Insurance in its Risk Insights Index.

“Global cyber crime is growing more complex by the day, presenting security leaders with new challenges,” said Corvus chief information security officer Jason Rebholz.

“With the power of security insights and dynamic claims data feeding Corvus’ technologies, we can help our policyholders improve their cyber security posture by informing them of emerging threats and best practices.”

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Corvus found that ransomware claims declined in frequency in the US early this year, but that claims still remained much higher than FTT. The average ransomware claim came to US$256,000 (roughly AU$380,655) while the average FTT claim was US$90,000 (roughly AU$133,824).

The reason for this was that ransomware claims also cover the loss of data, interruption to a business, recovery of systems and breach response efforts.

The impact and consistency of FTT spiked to 36 per cent in Q3 of 2022, an all-time high. This percentage has not dropped below 25 per cent in six quarters.

“While ransomware continues to be a dominant risk, we are seeing tactics change, including the rise of other forms of extortion as well as funds transfer fraud,” added Rebholz.

“The findings from our report serve as a reminder to all security leaders that cyber security is fluid and attackers will shift their methods, even revisiting old tactics, so long as they continue to reap financial benefits.”

Business email compromise (BEC), the main cause of FTT and other cyber crimes, is on the rise too. Via BEC, bad actors gain access to account credentials and business emails.

Over 40 per cent of all claims in the second half of 2021 were BEC related, while FTT made up 70 per cent of BEC.

Despite ransomware claims dropping in frequency, a large percentage of those claims saw the theft of data being used to gain leverage over a company, with data exfiltration increasing 25 per cent from the second half of 2021 to the first half of 2022.

Almost half of all ransomware incidents that were claimed saw stolen data being used to gain additional leverage.

“It’s vital that the cyber security and insurance industries stay connected to remain agile in the changing threat landscape,” urged Rebholz.

“Rising instances of data exfiltration show that cyber criminals will respond quickly to thwart security professionals and identify creative ways to increase leverage in ransom negotiations. Insurers have visibility into these changes, enabling us to take an informed, proactive approach with our brokers, policyholders, and partners.

It’s Corvus’ responsibility as a leading insurtech to not only make our policyholders safer, but also to help empower the industry at large to make the world a safer place.”

Daniel Croft

Daniel Croft

Born in the heart of Western Sydney, Daniel Croft is a passionate journalist with an understanding for and experience writing in the technology space. Having studied at Macquarie University, he joined Momentum Media in 2022, writing across a number of publications including Australian Aviation, Cyber Security Connect and Defence Connect. Outside of writing, Daniel has a keen interest in music, and spends his time playing in bands around Sydney.

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