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Cyber insurance teams recover data, mitigate costs, and fix systems to help architectural practices and other businesses reopen faster when they fall victim to ransomware. Earlier this year, Hub International shared its thoughts with the OAA at the Association’s annual conference held in Sudbury.
An attack was waged on a network printer. Ransomware breached the engineering firm’s IT system. During a three-day blackout, missed deadlines brought reputational blows and big costs. Hackers set a ransom price of $350,000, holding servers hostage.
The firm that had been attacked called Christopher Greer, VP of professional lines at global broker Hub International, for a cyber insurance claim. Greer sent in a breach coach, a kind of cavalry scout for the system’s frontlines, to monitor new threats. The team recovered data and handled the ransom payment in cryptocurrency.
All in, the claim took one week and cost the engineering firm $750,000—this is below what Greer says is the average ransomware claim of $1 million. Without protection from cyber insurance, that number can skyrocket. The global average ransomware cost is $4.35 million (USD).
Greer told this story at the 2023 OAA Conference earlier this year to a room full of architects.
“We’re there to support individuals on the worst day of their career,” Greer said.
And that day might be coming sooner rather than later.
Ransomware attacks are on the rise, and architecture and design firms are prime targets. At the OAA’s conference, Greer and his colleague Asghar Molu, SVP of personal insurance at Hub, noted industry risks and the best way to handle an attack.
Architects and designers at greater risk of cybercrime
These days, most business is online—software downloads, file sharing, invoicing.
With multiple stakeholders on every project, architecture and design (A&D) firms are especially vulnerable to cyber threats.
“Design professionals are among the highest hazard classes because of the nature of data held, the longevity of multi-year contracts, and constantly transferring data back and forth throughout that extended time period,” Greer said.
Greer’s team covers all commercial insurance needs for A&D firms across Canada.
He said the bulk of his claims lately come from ransomware.
“A threat actor gets into your system and locks it down until you pay a ransom,” he explained.
That $1-million average claim cost covers more than the initial extortion. Fixing or buying new servers, getting employees back to work, and data recovery are part of his team’s job to minimize damage. Often, a second attack and increased ransom demands follow the first—not to mention the indirect costs of disclosed liabilities and bad PR. In some cases, third-party clients and subcontractors are also targeted.
“Cybercrime is on the rise,” Greer warned, adding that something as routine as invoice payment can be dangerous for all stakeholders. “If you receive a fake invoice and you pay it, how do you recoup those losses? How does your client recoup the losses? With a cyber policy, that money can be recovered.”
Without one? “You don’t have any recourse,” Greer added.
Greer’s presentation walked the audience through some of Hub’s tactics during an attack.
How to fight cybercrime with insurance coverage
Architects and designers are not typically cybercrime experts, and many firms are not set up to handle server breaches and shutdowns, let alone ransom payments.
Greer’s core team includes the breach coach, a specialist who assesses the threat and manages the whole situation. Think forensics, but online, investigating the cause and extent of the damage. Ransomware attacks are complex and multifaceted, and like any intensive project, require a project manager.
At Hub, a breach coach is held on retainer. Greer explained that it’s possible to hire a breach coach independently, but “the cost would be a lot higher, and you’re working with subcontractors.”
Finding an external coach during a breach takes precious time. Every minute counts; ransom demands often include timelines. Staff trained in IT, but not cybersecurity, could inadvertently reveal more private data in an exchange with hackers.
With all experts in-house, Greer adds, “You’re up and running quicker when you put in a claim.”
Once the threat is deemed credible, preparing the ransom money isn’t always straightforward. Cryptocurrency is a technical, finicky process.
“Individuals who run a business don’t necessarily know how to access cryptocurrency,” Greer explained. But this is the preferred payment method of hackers.
“To come up with the money in cash to buy the cryptocurrency to pay the ransomware—alone, as an individual, I wouldn’t know how to do that,” Greer admitted. The breach coach handles ransom payments. Finally, data is recouped or recreated and stored more safely.
The nature of work at architecture and design firms creates multiple entry points for hackers, frequent file-sharing over long-term projects. Fighting ransomware is a part-time job that requires the expertise of a breach coach. Insurance is the best way to fight cybercrime—so A&D firms don’t have to.
