How Insurance Can Halt Ransomware

 Tuesday, August 10, 2021

 Insurance Thought Leadership

In 1975, the Argentina grain exporter Bunge & Born paid $60 million to free a kidnapped executive. That ransom payment remains the largest ever paid for a single person, but his case marked the beginning of the end for high-profile hostage events.

The reason? Insurers began offering kidnap and ransom insurance.

The policies not only promised to reimburse ransoms but helped corporations with needed resources such as crisis managers and negotiators to get hostages to safety and to keep ransom costs in check.

Today, major multinational corporations stare down a similar, if less physically tangible, threat. Ransomware is not just a form of cybercrime but a malevolent industry unto itself.

With malware deployed to infiltrate networks and encrypt files, bad actors can essentially immobilize operations, create reputational damage and even physically harm people. More concerning, the bar has been lowered for entry with ransomware-as-a-service (RaaS).