A recent study reveals that possessing cyber insurance can significantly increase the ransom demands of ransomware attackers. Ransomware attacks involve the encryption of critical data, forcing victims to pay a ransom to regain access to their files. Without enough funds to meet these demands, individuals or businesses may lose everything stored on their systems. To mitigate such risks, it is advisable to maintain data backups, use anti-virus software, and practice safe browsing habits.

One protective measure is obtaining cyber insurance, which covers businesses against liabilities arising from data breaches. While this coverage can provide peace of mind, it may have unforeseen consequences during a cyber incident. The findings indicate that ransomware operators often exploit the presence of cyber insurance, raising their ransom demands substantially if they discover that a victim has such coverage. According to a report from Dutch police officer Tom Meurs, ransomware operators can increase their demands by an average of 2.8 times the initial ransom.

In some cases, they may demand as much as 5.5 times the original amount. Given that initial ransom demands are typically already significant, these multipliers can create severe financial strain for affected businesses. The report also highlights that a majority of ransomware operators check for cyber insurance before initiating a ransom. Analyzing data from 453 ransomware attacks between 2019 and 2021, it becomes evident that organizations with cyber insurance are particularly vulnerable to inflated demands from cybercriminals.

This conclusion underscores the necessity for businesses to be aware of the implications of having such coverage in the face of potential cyber threats.