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We live in an age where we are more “connected” than ever before.  Our phones are “smart,” are homes are “smart”and Alexa is our best friend. All of these conveniences can also make us more vulnerable to a range of new cyber risks.

What is Malware?

Malware is software that’s main function is to damage or disable a computer.  Generally, it infects our computers with a virus because we have clicked on an infected email or link.

What is Ransomware?

Ransomware is a type of malware is used by Cyber criminals to hold computer data hostage by encrypting the files. The cyber criminals demand a ransom payment before restoring access to the file.  The FBI says ransomware is the biggest cyber security problem in the world.

What is Phishing?

Phishing is the attempt to acquire sensitive information such as usernames, passwords, and credit card details (and sometimes, indirectly, money), often for malicious reasons, by masquerading as a trustworthy entity in an electronic communication. The term was coined due to the similarities of this technique with actual fishing by using bait in an attempt to catch a victim.

Insurance companies are now offering Home Cyber protection for families and individuals as part of their Homeowners Insurance policy. Some examples of Home Cyber protection losses are:

Claim Scenario #1

An individual opens an email that unleashes a virus, and the virus damages the hard drive.  To repair the damage the hard drive must be reformatted, the operating system reinstalled and the restored data backed up.

Total paid loss $1,200

Claim Scenario #2 

A teenager noticed he could see his neighbors’ wi-fi signature and network signal from his house. He thought it would be a fun game to try to guess their password. Because they never changed the default password of “0000,” the teenager easily gained access to the home’s connected devices and its network. Once he had access, he controlled everything from the security system, to the entertainment center, to the network laptops, and even the heating zones. By the time he was done with his game, he had successfully deactivated all the connected devices so they no longer worked. The neighbors tried to resolve the problem themselves, but quickly found that outside experts and service technicians were needed. Thus began the ongoing parade of technicians to reinstall the connected devices, costing the homeowners not only money but also valuable time.

Total paid loss $900

Claim Scenario #3

Cyber Extortion—The insured received a ransom note on his computer screen soon after he’d discovered that all his files had been locked. The message indicated that his files were not only locked but that he needed to pay $2,000 to obtain the key to decrypt them. If the payment was not received within a week, the price would increase to $3,000. After that, the decryption key would be destroyed and any chance of accessing the files and data on his computer would be lost forever. After consultation with an expert, the insured decided to pay the ransom.

Total Paid Loss: $1,500

Claims Scenario # 4

Data Breach—The insured volunteers at her children’s school. One of her responsibilities is to keep the teachers aware of students’ birthdays and their lunch accounts. The lunch account information contains credit card numbers and other personal information. She keeps track of all this information on a spreadsheet that is housed on her tablet. She does not secure the tablet with a password, so none of this critical data is encrypted. While on a field trip, she loses the tablet. After consultation with her lawyer, the insured learns that she must notify people that their personal information has been compromised.

Total Paid Loss: $4,200