Severity of Ransomware Attacks Increased 68% in First Half of 2024: Coalition Cyber Claims Report
2024 mid-year update also examines impacts of risk aggregation events
Ransomware claims severity spiked by 68% to an average loss of $353,000 throughout the first half of 2024
San Francisco, CA (Oct. 9, 2024) — Coalition, the world’s first Active Insurance provider designed to prevent digital risk before it strikes, has published its 2024 Cyber Claims Report: Mid-year Update, which details emerging cyber trends and their impact on Coalition policyholders throughout the first half of 2024. The report found that ransomware claims severity spiked by 68% to an average loss of $353,000.
“Although the frequency of using ransomware as an attack strategy actually decreased this half, we saw a marked spike in the severity and demand amounts, especially those associated with the Play and BlackSuit ransom variants,” said Rob Jones, Coalition’s Head of Claims. “Despite the increase, we were able to cut ransom demands in half through successful negotiations by our affiliate Coalition Incident Response, but the facts remain clear: the use and impact of ransomware remains as volatile as ever.”
While high ransomware demands came back in vogue, funds transfer fraud (FTF) saw a notable decrease in both frequency (2%) and severity (15%). Even with this decline, Coalition successfully clawed back $10.8 million in fraudulent payments on behalf of policyholders.
The Mid-year Update also addressed the notable increase in material cyber risk aggregation events that occurred during the first half of the year. Attacks on Change Healthcare and CDK Global occurred in 1H ’24 resulting in widespread third-party business disruption to larger SMBs and mid-market companies. Nearly 23% of healthcare businesses with more than $100 million in revenue were impacted by the Change Healthcare attack, as were 11% of those organizations with between $25 million and $100 million in revenue. Separately, nearly 75% of auto dealers with more than $100 million in revenue were impacted by the CDK Global ransomware event.
“As third-party risk continues to grow and aggregation events become part of the business lexicon, it’s equally important to spotlight how Coalition continues to take an active role in risk mitigation for policyholders,” continued Jones. “We engage policyholders upfront to strategize ways to minimize business disruption, looking for alternative ways to help them solve near-term cyber risk problems, accomplish their business goals, and minimize the overall financial impacts of these cyber events through proactive response.”
Other key findings from the report include:
- Overall claims severity increased by 14% to an average loss amount of $122,000, largely driven by the spike in ransomware severity. Threat actors targeted larger businesses and reaped the benefits with increased paydays. Meanwhile, overall claims frequency decreased by 4%.
- Business email compromise (BEC) was the leading cyber event. Continuing a steady trend that spanned all of 2023, the frequency of BEC events increased by 4% and accounted for nearly one-third of all cyber insurance claims.
- Due to threat actors trolling the internet for easy access, businesses using web-accessible applications were 3.1 times more likely to experience a claim.
About Coalition
Coalition is the world’s first Active Insurance provider designed to help prevent digital risk before it strikes. By combining comprehensive insurance coverage and cybersecurity tools, Coalition helps businesses manage and mitigate potential cyber attacks. Leveraging its relationships with leading global insurers and capacity providers, including Coalition Insurance Company, Coalition offers Active Insurance products to businesses in the United States, the United Kingdom, Canada, Australia, and Germany. Policyholders can receive automated cyber alerts and access expert advice and global third-party risk management tools through Coalition’s holistic cyber risk management platform, Coalition Control®. For more information, visit www.coalitioninc.com.
Insurance products are offered by Coalition Insurance Solutions Inc. (“CIS”), a licensed insurance producer and surplus lines broker with its principal place of business in San Francisco, CA (Cal. license #0L76155), acting on behalf of a number of unaffiliated insurance companies and available on an admitted basis through Coalition Insurance Company (“CIC”) a licensed insurance underwriter (NAIC # 29530). Insurance products offered through CIS and CIC may not be available in all states. Complete license and carrier information is available here. CIS may receive compensation from an insurer or other intermediary in connection with the sale of insurance. All decisions regarding any insurance products referenced herein, including approval for coverage, premium, commission, and fees, will be made solely by the insurer underwriting the insurance under the insurer’s then-current criteria. All insurance products are governed by the terms, conditions, limitations, and exclusions set forth in the applicable insurance policy. Please see a copy of your policy for the full terms, conditions, and exclusions. Copyright © 2024. All rights reserved. Coalition and the Coalition logo are trademarks of Coalition, Inc. or its affiliates.
SOURCE: Coalition via Omnia Partners