By: Sophia Young
Numerous cyberattacks are increasingly targeting the insurance industry. Ransomware is a significant threat to them, much like many other sectors, partly because ransomware attacks are covered by cyber insurance. However, it is equally vulnerable to other forms of assault. Insurance fraud is a significant concern to the industry since insurance companies have any personally identifiable information (PII) about their retail business-to-consumer (B2C) clients that criminals can exploit for fraud and other nefarious activities. In this article, we will tackle why hackers target the insurance industry and the top data security challenges they face.
Why Do Cyber Attacks Target Insurance Companies?
Insurance companies are a prime target for cyber assaults because they possess confidential policyholder data behind all products, regulations, and pricing. It is valuable because it allows an insurance business to provide customers with the exact products they require, presumably at the price they are looking for. Customers are more willing to share their data because there are more options and lower costs.
Insurance companies often gather protected personal sensitive information, in contrast to other industries that primarily keep sensitive financial data.
Business interruption and material costs for the undertaking, policyholders, and third parties are the main effects that insurers experience as a result of these cyber-attacks.
Data gathered can be exploited for various illegal activities, including identity theft for financial gain.
In addition to the immediate financial repercussions, cyber events can cause severe and persistent operational problems for targeted insurance firms. The harm to one's reputation could also be severe or even irreparable.
Any policyholders who experience business interruptions due to harmful cyber attacks will be directly impacted.
The market for cyber-underwriting is growing concurrently due to the rise in information and communications technology (ICT) mishaps, as indicated above. Statista predicts that between 2020 and 2030, the European cyber insurance industry will develop dramatically, doubling in size between 2020 and 2025. The role of insurers in this situation is essential. A healthy market for cyber insurance is a crucial factor. Managing and assisting in the prevention of cyber risk is the task.
Top Security Risks in the Insurance Industry
According to recent surveys, ransomware attacks have increased by over 350%, making them the preferred method of attack for many hackers.
It is a devastating form of attack because of the extent and magnitude of the harm it causes to business money, operational stability, and reputation. Most organizations prefer to pay the ransom to resolve the problem quickly when hackers hold data hostage. One of the reasons it is so common is that people are reluctant to take on cyber criminals and pay the ransom.
Today, preventing ransomware calls for a multifaceted strategy. You should adhere to other cybersecurity best practices, such as backing up data, upgrading outdated software, educating staff to recognize and respond to these attacks, and implementing anti-ransomware software.
Third-Party Cyber Breaches
More than 88% of insurance executives claim to outsource some of the most critical parts of their business. Most insurance firms now have a larger attack surface due to the recent unprecedented expansion of vendor networks, making them more susceptible to a breach from one of their vendors.
Nowadays, hackers can gain access to these systems via a compromised vendor, putting your systems in danger and putting you at risk of a data breach.
You must invest in solid attack surface monitoring systems and a robust third-party risk management (TPRM) strategy to prevent cyberattacks via vulnerable third-party suppliers.
By using cloud-based systems, insurance businesses open themselves up to more cloud exploits, such as denial-of-service and hijacking assaults, which give hackers access to insurance systems, allow them to tamper with data, and prohibit staff from accessing it.
Additionally, working in the cloud expands the assault surface, making it more difficult to defend against an attack. Because of this, you should think about the need for sensitive data intelligence which provides a view into what sensitive data the organization is responsible for and enables other control points to prioritize protection.
Social Engineering Attacks
Social engineering attacks are rising due to their growing sophistication and the widening knowledge gaps among employees about fundamental cybersecurity concepts. This ignorance, which frequently results from a lack of training, exposes insurance businesses to various security issues.
Cybercriminals trick insurance professionals into providing sensitive information by using social engineering assaults that pose as reputable institutions or authorities. It exposes their data to cybercrime.
Whaling attacks, a social engineering assault when cybercriminals send executives a counterfeit email to trick them into authorizing massive financial transfers, put insurance companies at risk of losing money and data loss.
Poor Security Posture
A solid cybersecurity posture that can resist various risks and assaults is needed to protect data from cyberattacks and cloud exploits.
The problem is that many insurance firms still use questionnaires, penetration testing, and on-site evaluations to gauge how robust their cybersecurity posture is today. These techniques are laborious, only give a momentary view of a company's cybersecurity, and fall short of what businesses must do to protect their data.
Security teams need sophisticated tools to continuously evaluate their posture to combat cyber hazards for insurance businesses; automated systems enable insurers to do so and obtain a more accurate assessment of their security in less time. Most importantly is an automated view into the types and location of sensitive data as it enters the environment so security teams can layer on proper controls.
While cyberattacks are inevitable, it is best to prepare yourself by investing in business interruption insurance, with installing anti-malware to safeguard your business's data and utilizing sensitive data intelligence to keep an updated, automated data inventory that feeds protection tools to keep protected the crown jewels. Insurance businesses must protect data stored anywhere and along the value chain and be ready for any potential risks.