2222222222

Risk Insider: Kevin Kalinich

Managing Malware Masterfully

By: | September 1, 2016 • 2 min read
Kevin Kalinich is the global cyber risk practice leader for Aon Risk Solutions, focusing on identifying exposures and developing insurance solutions. He can be reached at [email protected]

As ransomware morphed from low-severity consumer phishing to targeting entire networks of computers in hospitals, universities and businesses, it became more costly.

It also looks like email recipients have a lot more learning to do.

According to 2016 Verizon research, 23 percent of recipients open phishing messages and 11 percent of recipients click on attachments.

Ransomware, however, is just one version of “malware,” which includes all types of hostile or intrusive software, such as computer viruses, worms, trojan horses, spyware, adware, scareware, and other malicious programs. Malware, which stands for “malicious software,” can take the form of executable code, scripts, active content, and other software.

Entities should consider malware risks on an enterprise level.  It’s not just about IT. All employees, partners, customers and third-party outsourced providers should be considered.

The number of unique kinds of malware jumped from six million at the beginning of 2015 to just over 12 million by the end of the year, and the category of malware specifically targeting mobile phones has seen dramatic growth.

Organizations should quantify potential malware exposures in terms of financial statement impact and review potential available insurance coverage.

Advertisement




Malware could trigger a number of different lines of insurance, such as crime ($81 million Bank of Bangladesh heist), kidnap & ransom (Hollywood Presbyterian Medical Center’s $17K bitcoin ransom), property (Stuxnet in Iranian nuclear facility & other grid/manufacturing), general liability (Jeep Cherokee and medical device hacks), professional liability (Internet of Things service interconnectivity) and marine/supply chain (Islamic Republic of Iran Shipping Lines 2011).

Entities should consider malware risks on an enterprise level. It’s not just about IT. All employees, partners, customers and third party outsourced providers should be considered.

Even with top notch defenses, however, how do you defend against something that may be inevitable? Is there anything a business can do to protect against losses from malware? Many malware attacks exploit known bugs in software, and attackers depend on victims not installing patch updates. There are a number of technological and procedural risk management methods to help reduce the financial statement impact from malware, including:

  • Vet software purchases from a security standpoint as well as an operational standpoint.
  • Train employees regarding phishing, mobile apps, attachments, links and the like. Instruct employees not to open email from unknown sources and to verify sources before opening attachments or clicking links in any email, IM, or posts on social networks.
  • Ban workplace usage of unnecessary file types, software applications, websites, and BYOD downloads.
  • Improve detection and remediation of malware incidents.
  • Segregate data by priority classification.

Kalinich chart

 

 

According to the recent book, Dark Territory: The Secret History of Cyber War (June 2016):

“The only completely secure computer is a computer that no one can use … They have given up on the idea that they can somehow make a black box that nobody can get into.”

It turns out that incident response is as important as prevention from a balance sheet impact standpoint. Is there a contingency plan or business continuity plan in place? Some suggested actions to take if your computer is infected with malware:

  • Immediately stop using any computers on an infected network that performs sensitive activities.
  • Contact your IT department or a qualified IT professional to analyze your computers and network, and to remove the malware.
  • After you have taken appropriate steps to remove malware, change the passwords for any user accounts or systems that were accessed while using the infected computer.
  • Promptly notify the appropriate insurance carriers.

More from Risk & Insurance

More from Risk & Insurance

The Profession

Curt Gross

This director of risk management sees cyber, IP and reputation risks as evolving threats, but more formal education may make emerging risk professionals better prepared.
By: | June 1, 2018 • 4 min read

R&I: What was your first job?

My first non-professional job was working at Burger King in high school. I learned some valuable life lessons there.

R&I: How did you come to work in risk management?

After taking some accounting classes in high school, I originally thought I wanted to be an accountant. After working on a few Widgets Inc. projects in college, I figured out that wasn’t what I really wanted to do. Risk management found me. The rest is history. Looking back, I am pleased with how things worked out.

R&I: What is the risk management community doing right?

Advertisement




I think we do a nice job on post graduate education. I think the ARM and CPCU designations give credibility to the profession. Plus, formal college risk management degrees are becoming more popular these days. I know The University of Akron just launched a new risk management bachelor’s program in the fall of 2017 within the business school.

R&I: What could the risk management community be doing a better job of?

I think we could do a better job with streamlining certificates of insurance or, better yet, evaluating if they are even necessary. It just seems to me that there is a significant amount of time and expense around generating certificates. There has to be a more efficient way.

R&I: What was the best location and year for the RIMS conference and why?

Selfishly, I prefer a destination with a direct flight when possible. RIMS does a nice job of selecting various locations throughout the country. It is a big job to successfully pull off a conference of that size.

Curt Gross, Director of Risk Management, Parker Hannifin Corp.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

Definitely the change in nontraditional property & casualty exposures such as intellectual property and reputational risk. Those exposures existed way back when but in different ways. As computer networks become more and more connected and news travels at a more rapid pace, it just amplifies these types of exposures. Sometimes we have to think like the perpetrator, which can be difficult to do.

R&I: What emerging commercial risk most concerns you?

I hate to sound cliché — it’s quite the buzz these days — but I would have to say cyber. It’s such a complex risk involving nontraditional players and motives. Definitely a challenging exposure to get your arms around. Unfortunately, I don’t think we’ll really know the true exposure until there is more claim development.

R&I: What insurance carrier do you have the highest opinion of?

Advertisement




Our captive insurance company. I’ve been fortunate to work for several companies with a captive, each one with a different operating objective. I view a captive as an essential tool for a successful risk management program.

R&I: Who is your mentor and why?

I can’t point to just one. I have and continue to be lucky to work for really good managers throughout my career. Each one has taken the time and interest to develop me as a professional. I certainly haven’t arrived yet and welcome feedback to continue to try to be the best I can be every day.

R&I: What have you accomplished that you are proudest of?

I would like to think I have and continue to bring meaningful value to my company. However, I would have to say my family is my proudest accomplishment.

R&I: What is your favorite book or movie?

Favorite movie is definitely “Good Will Hunting.”

R&I: What’s the best restaurant you’ve ever eaten at?

Tough question to narrow down. If my wife ran a restaurant, it would be hers. We try to have dinner as a family as much as possible. If I had to pick one restaurant though, I would say Fire Food & Drink in Cleveland, Ohio. Chef Katz is a culinary genius.

R&I: What is the most unusual/interesting place you have ever visited?

The Grand Canyon. It is just so vast. A close second is Stonehenge.

R&I: What is the riskiest activity you ever engaged in?

Advertisement




A few, actually. Up until a few years ago, I owned a sport bike (motorcycle). Of course, I wore the proper gear, took a safety course and read a motorcycle safety book. Also, I have taken a few laps in a NASCAR [race car] around Daytona International Speedway at 180 mph. Most recently, trying to ride my daughter’s skateboard.

R&I: If the world has a modern hero, who is it and why?

The Dalai Lama. A world full of compassion, tolerance and patience and free of discrimination, racism and violence, while perhaps idealistic, sounds like a wonderful place to me.

R&I: What about this work do you find the most fulfilling or rewarding?

I really enjoy the company I work for and my role, because I get the opportunity to work with various functions. For example, while mostly finance, I get to interact with legal, human resources, employee health and safety, to name a few.

R&I: What do your friends and family think you do?

I asked my son. He said, “Risk management and insurance.” (He’s had the benefit of bring-your-kid-to-work day.)

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]