Fund Frauds, Cyber-Insurance Claims Spiking This Year

Ransomware attacks were mainly responsible for a significant jump in the number of cyber-insurance claims during the first half of the year, The Record reports. Damage caused by such attacks increased as well.

Coalition Inc., a San Francisco-based insurer, calls ransomware the “largest driver of the increase in claims frequency,” which was up 12 percent through the end of June. May had “the most ransomware claims in a single month in Coalition history.” Royal, BlackCat, and LockBit 3.0 were the most common variants.

The data also underscored the prevalence of funds transfer frauds in which cybercriminals redirect an online money transfer into their pockets. Transfer fraud claims were up 15 percent in the first half of the year. They were more costly too, with an increase of 39 percent translating to an average loss of just under $300,000.

“The growing sophistication of threat actors and their tactics is a contributing factor in the upward trend in FTF claims severity,” according to Coalition. “The longer a threat actor remains in an email account after compromise, the more difficult it becomes to recognize and report abnormal activity — and they appear more willing to wait for the right moment to intercept or redirect large payments.”

Although it is unknown how much companies end up paying ransomware groups, data shows that the average ransom demand was $1.62 million, 74 percent more than in 2022.

It’s not exactly a silver lining, but claims related to business email compromise dropped 15 percent. Their cost dropped as well, to an average loss of $21,000.