Financial Costs of the Ransomware Attack and breaking the Attack Chain Ransomware is a kind of malware that typically employs encryption to prevent or restrict access to information until a ransom has been paid.
If a business is hit by the ransomware threat the collateral damage to revenues can be more significant than the amount of ransom, and the decision to make payment or not. The financial consequences could be extensive and extend much more than the ransom.
The ransom
Experts advise companies to not pay ransoms since it provides cybercriminals with a reason to carry on. The companies who do pay the ransom usually are disappointed by the outcome.
- The information they retrieve is damaged.
- The attackers are demanding more money.
- The attackers disappear and they can’t find their information.
Recent research conducted by Sophos along with Pao Alto put the average ransomware attack’s cost at $570,000 and $812,360.
Since cybercriminals are now using techniques for encryption that are asymmetric that are able to decrypt the data is very likely. If you don’t wish to shell out the ransom, you’ll or have to retrieve the information from backups or copies or completely lose it.
If you are the victim of the threat of ransomware you should take your chances and stick to your plan for responding to an incident. If you’ve got a well-designed recovery plan it is possible to restore your data without much interruption, and you’ll not be required to pay for the ransom. A recovery plan typically consists of five steps: analyze the situation, reduce, respond to, communicate, and reflect.
Prevention is always more effective than attempting to repair the massive damage that an attack by ransomware can cause. Find out more information about how to lower the likelihood of becoming a victim from the beginning on Perception Point.
Costs of downtime and labor
When your systems are in a state of failure, you could be able to incur financial loss. Most companies require at the very least a week and usually much longer to restore information. In the meantime the entire operation will likely be hampered. Data about customers is essential for running a business efficiently and, without it, you’ll struggle to sell products, serve clients, and many more. The typical loss in productivity can be as high as 20% in the time of downtime.
In the 2021 ransomware attack known as that is the Kaseya attacks around 1500 customers of managed service providers were affected. This is a clear example of how supply chain attacks are more destructive than attacks targeting individuals.
IT teams are often required to work in overtime to restore systems. There is typically a backlog of work in an company due to the absence of data access. Additional consulting or support from a specialist might be required to solve problems with data.
The cost of the brand’s reputation
A reputation that has been damaged by a brand is very difficult to fix and could have significant financial consequences. The negative publicity that comes from the incident can impact the relationships not just with customers , but also with investors, employees, as well as other stakeholder. Research conducted by the National Cyber Security Alliance indicates that around 60% of all small and medium-sized companies go out of operations within six to eight months after experiencing an incident involving data.
Legal costs
There’s a rising trend for cybercriminals to beware of exposing sensitive data that they transfer in advance of encryption. When the data is of a critical nature like at hospitals, in government offices or crisis call centres, it could result in catastrophic damage.
In certain industries, clients may be able to claim compensation directly in the event of a data breach. Scripps Health, retail giant Target and gas giant Colonial Pipeline are just some of the businesses which have faced lawsuits from class actions.
The majority of cases are resolved out of court since companies do not want to fight lengthy litigation. Fines for violations of law and regulation are often high in the case of the leak of health information, personal data, financial information such as credit card information, as well as personally identifiable data.
Damage to data as well as collateral damages
There is a chance that you lose your files completely because of an attack by ransomware. Loss of data could amount to many hours. Even if you are able to restore backups of files it is possible that they weren’t backed up fully or properly. There are currently ransomware-related variants that attack backup systems, so you won’t be able to restore your backups.
You’ll need to figure out how cybercriminals gained access your system. There are numerous methods they could use to gain access by sending out fake emails to making fake websites to directly attack the weaknesses of software.
Infected computers may need to be completely rebuilt and the software reinstalled. It is likely that you will require additional protection to ensure that another data breach is not averted.
With the present economic climate that is characterized by inflation and recession, all costs associated with a ransomware breach could cause a substantial financial loss. In 2020 , various reports suggested that the typical cost of clearing up after a ransomware breach could be around $1.85 million. If you don’t get rid of your data and correct any issues that are underlying it could be a risk for another attack.
How to avoid ransomware attacks
- Security systems that are in place as well as employee training and solid configuration management are just a few methods to avoid ransomware-related attacks.
- It is crucial to be up-to-date with the most current operating software.
- Be sure to are backed up with the most current and complete backups, as they could aid in recovering the data.
- Make sure your computer systems are current Be sure to install security patches.
- Always check your security to make sure you’ve got the correct security measures in the right place.
IT professionals must adopt a proactive approach since once hackers are inside your company, it could be difficult to limit the harm. You must secure each channel including email, which is usually among the more vulnerable channels.
Cybercriminals are constantly using more sophisticated methods to send ransomware through emails. You should look for solutions to secure your email which use speedy and efficient scanning technology that is constantly updated. The software should also be able to identify threats that are hidden within the emails.
Conclusion
Ransomware can cause financial damage for businesses in a variety of ways, including ransom expenses including downtime expenses, cost of labor reputation damage, and legal fees. Businesses must consider a comprehensive look at their security measures. Recognizing and addressing potential security risks and channels, like cloud collaboration and email tools will help in reducing ransomware-related attacks.