Coalition, the pioneering Active Insurance provider focused on preemptive digital risk management, has unveiled its 2023 Cyber Claims Report: Mid-year Update, offering a comprehensive analysis of cyber trends in the initial half of the year. The report sheds light on an alarming 12 percent surge in cyber claims, driven by substantial upticks in ransomware and funds transfer fraud (FTF) incidents.
According to the Mid-year Update, claims frequency and severity witnessed an upswing across all revenue bands for businesses in early 2023. Companies generating over $100 million in revenue bore the brunt, experiencing a 20 percent surge in claims and a staggering 72 percent escalation in claims severity compared to the second half of 2022.
“The cyber threat landscape has become more volatile, resulting in more frequent and severe claims,” commented Chris Hendricks, Head of Coalition Incident Response. “To mitigate these costly and disruptive incidents, organizations need to prioritize enhancing their security defenses and risk management. Fortunately, they don’t have to tackle this challenge alone, and with partners like Coalition, support is available before, during, and after an incident.”
The report also highlighted a significant rise in ransomware claims, escalating by 27 percent in the first half of 2023 compared to the latter half of 2022. The severity of these claims hit a record high, surging by 61 percent, with cybercriminals increasingly demanding an average ransom of $1.62 million, marking a 47 percent increase in the past six months and a staggering 74 percent surge over the last year.
In a remarkable feat, Coalition’s Active Cyber Insurance facilitated the recovery of an unprecedented $23 million in stolen funds, all of which were directly returned to policyholders. Particularly noteworthy was the nearly threefold increase in Coalition’s total FTF recovery amount compared to the latter half of 2022, with an average recovery amount of $612,000 per FTF claim, representing 79 percent of all FTF losses in recoverable instances.
Key highlights from the report include:
FTF claims frequency spiked by 15 percent in the first half of 2023, with FTF severity surging by 39 percent to an average loss of over $297,000.
Coalition effectively negotiated ransomware payments down to an average of 44 percent of the initial amount demanded.
Notably, businesses using Google Workspace for email showcased superior security compared to those utilizing Microsoft Office 365 (M365) and on-premises Microsoft Exchange, experiencing a 25 percent risk reduction for FTF or BEC claims and a 10 percent risk reduction for ransomware claims.
The report consolidates claims and incident data from the first half of 2023, encompassing high-profile claim events and cyber attacks that pose ongoing risks to businesses. By conducting extensive security scans and investigations, Coalition offers valuable insights into the evolving industry landscape, empowering organizations to comprehend and mitigate their cyber risk effectively.