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Showing posts with label IBM research. Show all posts
IBM Security
AI governance AI Risks AI Systems AI technology Breaches Cyber Security Data Breaches data security IBM IBM research IBM Security

Racing Ahead with AI, Companies Neglect Governance—Leading to Costly Breaches

 

Organizations are deploying AI at breakneck speed—so rapidly, in fact, that foundational safeguards like governance and access controls are being sidelined. The 2025 IBM Cost of a Data Breach Report, based on data from 600 breached companies, finds that 13% of organizations have suffered breaches involving AI systems, with 97% of those lacking basic AI access controls. IBM refers to this trend as “do‑it‑now AI adoption,” where businesses prioritize quick implementation over security. 

The consequences are stark: systems deployed without oversight are more likely to be breached—and when breaches occur, they’re more costly. One emerging danger is “shadow AI”—the widespread use of AI tools by staff without IT approval. The report reveals that organizations facing breaches linked to shadow AI incurred about $670,000 more in costs than those without such unauthorized use. 

Furthermore, 20% of surveyed organizations reported such breaches, yet only 37% had policies to manage or detect shadow AI. Despite these risks, companies that integrate AI and automation into their security operations are finding significant benefits. On average, such firms reduced breach costs by around $1.9 million and shortened incident response timelines by 80 days. 

IBM’s Vice President of Data Security, Suja Viswesan, emphasized that this mismatch between rapid AI deployment and weak security infrastructure is creating critical vulnerabilities—essentially turning AI into a high-value target for attackers. Cybercriminals are increasingly weaponizing AI as well. A notable 16% of breaches now involve attackers using AI—frequently in phishing or deepfake impersonation campaigns—illustrating that AI is both a risk and a defensive asset. 

On the cost front, global average data breach expenses have decreased slightly, falling to $4.44 million, partly due to faster containment via AI-enhanced response tools. However, U.S. breach costs soared to a record $10.22 million—underscoring how inconsistent security practices can dramatically affect financial outcomes. 

IBM calls for organizations to build governance, compliance, and security into every step of AI adoption—not after deployment. Without policies, oversight, and access controls embedded from the start, the rapid embrace of AI could compromise trust, safety, and financial stability in the long run.
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Security Vendors
Cyber Attacks Cyber attacks on Industrial leaders IBM research ransomware attacks Ransomwares resilience Security Vendors

Cyberattacks on Single Points of Failure Are Driving Major Industry Disruptions


Cybercriminals are increasingly targeting single points of failure within companies, causing widespread disruptions across industries. According to cybersecurity firm Resilience, attackers have shifted their focus toward exploiting key vulnerabilities in highly interconnected organizations, triggering a “cascading effect of disruption and chaos downstream.” This strategy allows cybercriminals to maximize the impact of their attacks, affecting not just the initial target but also its partners, clients, and entire industries. 


The financial consequences of these attacks have been severe. According to IBM research, the global average cost of a data breach in 2024 was nearly $4.9 million. However, some breaches were far more expensive. One of the most significant incidents involved a ransomware attack on Change Healthcare, a subsidiary of UnitedHealth that processes billions of medical claims annually. UnitedHealth reported that the attack cost the company $3.1 billion in response efforts, making it one of the most financially damaging cyber incidents in recent history. 

The attack caused major disruptions across the healthcare sector, impacting hospitals, insurance providers, and pharmacies. John Riggi, national cybersecurity advisor for the American Hospital Association, described the incident as “the most significant and consequential cyberattack in the history of U.S. health care.” Another major ransomware attack targeted CDK Global, a software provider for car dealerships across the U.S. The breach resulted in over $1 billion in collective losses for affected dealerships, according to estimates from Anderson Economic Group. 

This attack further demonstrated how cybercriminals can cripple entire industries by targeting critical service providers that businesses rely on for daily operations. Resilience’s analysis indicates that third-party risk has become a dominant driver of cyber insurance claims. In 2024, third-party breaches accounted for 31% of all claims filed by its clients. While the number was slightly higher in 2023 at 37%, none of those incidents resulted in material financial losses. The report also found that ransomware targeting vendors has become a significant concern, contributing to 18% of all incurred claims.  

Ransomware remained the top cause of financial loss in cyber incidents last year, responsible for 62% of claims involving monetary damages. However, Resilience’s research suggests that while ransomware remains a major threat, its frequency may be declining in broader markets. This trend is attributed to cybercriminals shifting their focus from random, large-scale attacks to more strategic operations against high-value targets that offer larger payouts. 

The evolving threat landscape underscores the need for organizations to strengthen cybersecurity measures, particularly in highly interconnected industries. With cyberattacks becoming more sophisticated and financially motivated, businesses must prioritize risk management, enhance third-party security assessments, and invest in cyber resilience to prevent large-scale disruptions.
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UnitedHealth breach
business disruption cybersecurity trends Data Breach data breach costs Healthcare Cyberattacks IBM research UnitedHealth breach

Cyberattacks and Technology Disruptions: Leading Threats to Business Growth

 

The global average cost of a data breach soared to nearly $4.9 million in 2024, marking a 10% increase compared to the previous year, according to a report by IBM.

In late October, UnitedHealth disclosed that a significant cyberattack on its Change Healthcare subsidiary earlier in 2024 might have exposed the data of 100 million individuals. This incident is regarded as the largest healthcare data breach ever reported to federal regulators, as first reported by Healthcare Dive.

Earlier that month, the company revealed the breach had led to a financial impact of $2.5 billion over the nine months ending September 30, including $1.7 billion in direct response costs. Additionally, the business disruption caused by the attack was estimated at $705 million.

“We continue to work with customers to bring transaction volumes back to pre-event levels and to win new business with our now more modern, secure, and capable offerings,” UnitedHealth CFO John Rex stated during an earnings call. “We expect to continue to build back the business to pre-attack levels over the course of ’25 and estimate next year’s full year impact will be roughly half of the ’24 level.”

Other major companies like AT&T, Live Nation Entertainment (the owner of Ticketmaster), and Dell also reported significant data breaches in 2024.

Chubb's research highlighted that 40% of executives identified cyber breaches and data leaks as the most disruptive and financially challenging man-made threats.

The study also found that 86% of businesses either have or plan to implement business interruption coverage for risks such as cyberattacks, natural disasters, or supply chain disruptions. Of these, 53% already have coverage, while another third intend to add it within the next year.

Monitoring cyber incidents has become the most widely used tool for mitigating risks.

“Corporate leaders must take a holistic approach to simultaneously mitigate both new and old business risks effectively,” the report emphasized. “They must also develop the ability to monitor and mitigate all these risks around the clock to ensure they are effectively protected.”

The findings are based on a survey of 517 executives from various industries across the U.S. and Canada.
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