Though ransomware attacks can be expensive, the cost associated with the ransom is not the only thing that CISOs have to worry about. They also need to be well-prepared to effectively deal with the aftermath of a ransomware attack.
In recent years, especially since 2020, ransomware attacks have increased dramatically. In fact, according to the SonicWall Cyber Threat Report 2021, ransomware attacks for the first half of this year are up at a staggering 151% over the same period in 2020. Also, Organizations have been facing waves of digital extortion in the form of targeted ransomware.
In the aftermath of a ransomware attack, organizations have to bear higher financial costs associated with it, like ransom paid, lost business, consultant fees and much more – there are also lesser-known financial impacts associated. Even though not all of them are related to security, CISOs and other security leaders should be aware of these potential costs while justifying their investments in cyber security to protect against ransomware. Here are a few direct and indirect ransomware costs CISOs should be aware of:
Keeping the company afloat
After a ransomware attack, keeping the business operation running can become highly expensive. In fact, successful ransomware attacks can affect business operations for days, weeks or even months at a time. According to industry experts, the ransomware recovery costs can be much higher than the cost of ransom payment itself. Also, organizations may not find where all of their data is, and they do not know if it is backed-up until the recovery process begins.
Post recovery, organizations that have been compromised still don’t feel that the threat is mitigated. It can take them a year to fully recover, depending on the data complexity. Additionally, the skills required to continue the recovery as well as ongoing due diligence are outside of the skills of most IT teams, leaving these organizations vulnerable for years to come.
Higher cyber insurance fees
To protect themselves from cyber-attacks, most organizations have insurance policies, considering what’s potentially at stake in terms of the financial impact of such an intrusion. However, organizations experiencing ransomware attacks witness an increase in insurance fees. Moreover, the amount they have recovered from various policies may not be as high as expected. To tackle this situation, organizations should take steps to work with the insurance brokers and other organizations with the same policies to find out how they can keep costs down.
Losing customer trust
In the event of a ransomware attack, customers may not be able to access customer support, sales or any other functions. This can lead to loss of sales, prospects as well as customer frustration. Customers may feel that the business is not reliable.
Even though customers may lose their sense of trust only for a brief period of time, it can significantly damage the reputation of the organization. The loss of trust may have negative effects not just on the existing customers but potential new customers as well. The trust issue related to the product can also extend to business partners such as service providers, suppliers, consultants and others.
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