Recently, a ransomware attack, known as the “Petya” cyberattack, spread from Ukraine to more than 60 countries, and shut down major shipping companies, a pharmaceutical company, an airline booking company, hospitals in Pennsylvania, a major international law firm and even a Cadbury chocolate factory in Australia. This comes only a month after the “WannaCry” malware attack, one of the worst and most widespread cyberattacks, which affected over 200,000 victims in at least 150 countries, including Britain’s National Health Service, FedEx and automakers Renault and Nissan. A ransomware attack, like the Petya and WannaCry attacks, disables the user’s computer system and all its data. A note in a text file then appears stating that in order to unlock the computer and access its data, a ransom must be paid, typically in the form of Bitcoin. The hackers threaten to delete all data on the computer system if payment is not sent.
These attacks, which are expected to be on the rise, are a reminder of the importance of cyberinsurance coverage. It is estimated by risk-modeling firm Cyence that the recent Petya and WannaCry attacks will result in $8 billion in economic losses. Businesses affected by these types of attacks can incur significant loss, including for the ransom amount, resulting business interruption, the cost of any lost data, damage to customers and other third parties, and associated public relation expenses. Most commercial general liability policies and property policies exclude coverage for cyber-related losses. Thus, it is important for businesses to ensure they have comprehensive coverage for cyber-related attacks.
