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Ransomware Attacks Spike, Leading to Increased Demand Values

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November 01, 2018

According to new data released by Beazley, reported cases of ransomware attacks and the value of ransom demands in the most sophisticated type of breaches have spiked in the third quarter of 2018.

Ransomware is a type of malicious software that restricts access to an infected machine, usually by encrypting files on the hard drive, and then demands payment of a ransom—often in a cryptocurrency—in exchange for the key to decrypt the data, the organization said.

Beazely’s Breach Response (BBR) Services team said recorded ransom demands increased to as much as $2.8 million in cases where criminals either targeted a particular organization or, upon obtaining access, discovered that they had more leverage and therefore increased the ransom demand. Hackers have also been adding pressure on victims to pay the ransom by conducting reconnaissance on their network and compromising back-ups before deploying the encrypting malware.

While ransom demands have grown to seven figures in extreme cases, these remain rare, and the median demand stands at $10,000 in 2018. This is significantly higher than the average of $1,000 reported in Beazley Breach Insights—October 2016, according to Beazley.

In the first three quarters of 2018, 71 percent of ransomware incidents handled by BBR Services were for small and medium-sized businesses.

Katherine Keefe, head of BBR Services at Beazley, said, "The complexity of different forms of ransomware and its capacity to stop business in its tracks frustrates organizations' abilities to tackle these issues. Unfortunately it is often smaller businesses that are most vulnerable to attack by cyber criminals, as they frequently lack the resources and protocols of larger firms. However, businesses of all sizes need to ensure their [information technology] employees are aware of the risks through up-to-date training and implementation of cyber security measures."

The Beazley Breach Insights report is available on its website free of charge.

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