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The Day You Get Locked Out By Ransomware
October 4 2017

The Day You Get Locked Out By Ransomware

Randy Sadler Captivating Thinking

RISK MANAGEMENT magazine recently reported on the growing threat of ransomware in an article by Editor Hillary Tuttle titled “Ransomware Ready: How To Prepare For The Day You Get Locked Out.”  According to the article:

It has become a cliché with so many cyber risks that the question is when, not if, a business will face the threat, but this aphorism is perhaps most accurate when it comes to ransomware. Last year, the FBI recorded more than 4,000 attacks a day, a 300% increase over 2015, and cybersecurity firm Kaspersky Lab reported that ransomware attacks on businesses went from one every two minutes in January 2016 to one every 40 seconds in October. Whether deployed for strategic disruption or for quick cash-grabs, with ransomware available for purchase on the dark web and the considerable efficacy and ease of launching attacks, the threat only grows.

Preparation is critical to weather a cyber attack, and one way for a business to be well-prepared is to own its own insurance company, known as a captive insurance company.  Captives allow businesses to have insurance policies with fewer exclusions than most commercial policies.  Also, captives can also be more timely and responsive in the event of a claim.  This can be the difference between surviving a ransomware attack and going out of business.

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  • 2020 Lessons Learned: Captive Insurance And What The Future Likely Holds For Middle-Market Companies
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  • Webinar: 2020 Lessons Learned: Captive Insurance And What The Future Likely Holds For Middle-Market Companies
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9721 Cogdill Road, Suite 202
Knoxville, TN 37932
Phone: 865.248.3044
Fax: 865.966.1199

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Stronger Business Model

Businesses who implement ERM programs combined with a captive to plan for unforseen risks stand a better chance of surviving, and passing to the next generation.

Improved Cost Controls

Captive owners can leverage their ERM and captive programs to improve their negotiating ability when renewing their commercial insurance coverages.

Wealth Accumulation

Profitable captives will see their reserves grow over time to significant sums which can be utilized by their owners for retirement or other life cycle needs.

Advantageous Tax Treatment

Insurance companies are the only entities allowed to expense projected future expense against current-year revenues (claim reserves). Small captives (premiums of $2.2M or less per year) may also elect to only be taxed on their investment income, potentially resulting in substantial tax savings for their owners.

Insurance Profits

Utilizing your captive to reduce or replace your commercial insurance coverage with policies issued by your captive allows you to capture insurance profits previously realized by the carriers.

Improved Risk Management

Adding a captive and ERM program will result in a higher awareness and enhanced strategies for how your organization thinks about and plans for all risks.

Asset Protection

The assets held by a properly organized and managed captive enjoy a very high degree of protection from both the business’ and business owner’s creditors.