CFC’s Graeme Newman on the vital role insurance is playing in the global fight against cybercrime

Graeme Newman, chief innovation officer at CFC Underwriting

The insurance industry is rising to the challenge to help protect businesses from digital criminals and working well with government, law enforcement and the security community, says Graeme Newman, chief innovation officer at CFC Underwriting, as he hits out at accusations the sector is fuelling this sort of crime.

The widely reported rise in ransomware attacks against businesses around the world has ensured that Covid-19 is not the only virus that has placed the insurance industry under the spotlight of public opinion. This latest worrying trend in criminal behaviour has led a number of high-profile commentators – including Ciaran Martin, former head of the UK’s National Cyber Security Centre – to accuse the insurance industry of funding cyber criminals and fuelling this form of crime.

Recent growth in cyber insurance has coincided with headline grabbing news of multi-billion pound global corporates having their data held to ransom by criminal gangs and rogue nation states, demanding multi-million dollar sums for its release.

But to accuse the industry of supporting this crime is to mistake correlation for causation and to misunderstand the vital role our industry is playing in the global fight against cybercrime.

In a parallel with the formation of the modern property insurance market over three-hundred years ago, where Fire Offices were established by insurance companies to provide their policyholders with access to fire engines that were not yet available as part of a state provided service, the insurance market has risen once again to fill the gap in public emergency services.

Digital criminals

Faced with a new breed of digital criminals, businesses have few places to turn for assistance. Cyber insurers have developed products and services, in combination with specialist providers, to offer the necessary support and resources to help businesses recover as quickly as possible, and to ultimately help protect them from this increasingly serious source of crime.

Without this support, businesses are often left fearing that paying the ransom is the only way to solve the problem.

Working in close partnership with global law enforcement the insurance industry has a vital role to play in the fight against cybercrime.

Data gathered as part of investigations is leading to unparalleled insight into the causes of crime, allowing insurers to identify and remediate these problems with their clients before they are exploited by criminals. And when it comes to the thorny issue of ransom payments, insurers can ensure a structured approach is taken and law enforcement are provided with the intelligence they need to ultimately track down and catch the perpetrators.

This close connection between the industry and global law enforcement is working.

Intelligence provided by cyber insurers has played a significant part in helping international law enforcement agencies to take down a number of ransomware networks and tackle the underlying cause of this crime. There is also a growing body of evidence that insurers are identifying and supporting their clients to address many of the vulnerabilities that leave them open to this disruptive form of crime.

Battle

All this work that is going on behind the scenes is starting to pay dividends. In addition to the actions being taken by global law enforcement against the cybercriminals, fewer businesses are giving in to cyber extortion when they are able to recover. The latest Coveware Quarterly Ransomware Report revealed a 34% decrease in average ransom amounts paid.

I’m proud of the industry we work in and what has been achieved to date.

The insurance industry is uniquely positioned to join public and private sectors to provide a united front in the battle against cybercrime.

But we are simply at the beginning of this complex journey and must continue to adapt and evolve our approach. With continued collaboration across the insurance industry, law enforcement, government and the security community, we can collectively work to fight, not fuel, this new world of crime.

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