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A Wednesday statement released by Herjavec Group, an information security firm, indicated that the damages and related costs inflicted on corporations and individuals by ransomware attacks will increase to $1 billion annually by the end of 2016.
Herjavec CEO Robert Herjavec said that hackers are beginning to take particular aim at hospitals and health care providers in a Wednesday appearance on CNBC's "Squawk Alley."
"The systems are outdated and now what you're seeing here is with the growth of the 'internet of things,' the physical world and infrastructure is being connected to the cyber world and hospitals, utilities are archaic," Herjavec said. "Their systems are very old. They're in a rush to connect those systems and so they're creating a lot of gaps."
Hackers use ransomware, usually embedded in a seemingly-benign link or webpage, to install malicious software on a victim computer that encrypts important files and refuses to unlock them unless a ransom is paid to the hacker.
"A lot of people pay these ransoms because it's convenient," Herjavec said. "We never recommend that you pay because you have no guarantee that you won't be a victim again."