Ransomware Attack and Real Life Insurance Claims

Ransomware Attack and Real Life Insurance Claims

RansomwareA Ransomware attack, such as WannaCry and Petya or NotPetya, can happen to any business at anytime. Basically, some super smart, but not very nice computer guy hacks your system and encrypts all of your files. In order to get your computer files back, you have to send the bad guy some money. Sometimes, it’s just a few hundred dollars and sometimes it may be thousands. Sounds like a pretty easy situation to fix, right? Well, not necessarily. Take a look at these real life ransomware attacks and the corresponding insurance claims that were recently paid by Chubb Insurance.

Real Life Ransomware Attack – Claim #1

An assisted living facility experienced a “brute force” ransomware attack and had several of its files encrypted. A ransom of approximately $30,000 was initially demanded. After paying a small amount of the ransom demand to obtain a sampling of the decryption tool, the company decided to instead rely on its backups to restore its systems. While no Personally Identifiable Information (PII) was compromised as a result of the attack, several critical systems important to the company became inoperable. This included call button systems, security systems and the medicine tracking software. The company incurred losses of more than $250,000 to get the affected systems back on-line. As well as an additional $50,000 for the services of a breach coach and forensic vendors.


Real Life Ransomware Attack – Claim #2

A hospital’s computer system was the subject of a ransomware attack. While the attacker sought only $500, the cyberattack essentially shut down the medical facility. The hospital incurred significant expenses attempting to restore the data from their computer systems. They could not bill any of the health insurance carriers while the system was affected. Additionally, the imaging capabilities of the hospital were greatly impacted as they could not produce the images from MRIs or CT scans. The malware completely corrupted the hospital’s system and they had to resort to paper mode to chart and monitor patients. Lastly, the hospital’s payroll system also went down as part of the attack. As a result of the attack, more than $700,000 was paid for forensics, data recovery, business interruption and crisis management costs.

These are only two of many, many ransomware attacks over the last few years. As you can see, even a small ransomware attack can be extremely costly in the end. This is why you need to make sure you have the proper coverage on your business insurance policy. Contact RCI Insurance Group today to visit with one of our commercial insurance professionals .


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