Insider Threats: Types, Examples, and Defensive Strategies in 2025

What is an insider threat?

An insider threat is a security risk that originates from within an organization. It involves current or former employees, contractors, or business partners who misuse their legitimate access or system privileges, whether maliciously, negligently, or through compromised credentials, to compromise data, intellectual property, or critical systems. Insiders can even take the form of compromised service accounts, and while the term most often describes malicious activity, it also covers users who unintentionally cause harm to the business.

The motivations behind malicious insiders vary, but most compromises and data exfiltrations are financially motivated. Incidents can also stem from espionage, retaliation or a grudge against the employer, or simple carelessness such as poor password hygiene or an unlocked or stolen device. Insider threats are more common in some industries, such as healthcare, the financial sector, and government institutions, but they can compromise the information security of any company.

Insider threats generally fall into three categories:

• Negligent insiders: the most common and often most costly source of incidents. These users mean no harm but expose data through poor password hygiene, lost devices, or feeding sensitive information into unauthorized generative AI and shadow IT tools.
• Malicious insiders: individuals who intentionally abuse their access for personal gain, revenge, espionage, or to steal trade secrets.
• Compromised insiders: legitimate users whose credentials are hijacked, or who are tricked through social engineering and phishing into handing attackers access to corporate networks.

Defending against insider threats combines behavioral analytics with strict access controls:

• Data loss prevention (DLP): track and restrict sensitive data from being downloaded, printed, or emailed to personal accounts.
• User and entity behavior analytics (UEBA): baseline normal employee activity and flag sudden, abnormal behavior, such as downloading massive files at unusual hours.
• Zero trust and least privilege: give users access only to the data and systems they need, and enforce strong multifactor authentication (MFA).
• Employee education: train staff regularly on secure practices, especially the risks of shadow AI and phishing.

Recommended Reading: Security Big Data Analytics: Past, Present and Future.

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Understanding the insider threats market trends

The insider threat management market is growing quickly as organizations recognize that traditional perimeter-based security tools cannot stop threats that originate from trusted users. The market is expected to grow from USD 3.03 billion to USD 6.32 billion by 2030, with a compound annual growth rate (CAGR) of 15.8%. This growth is driven by increasing concerns around credential misuse, data theft, sabotage, and unauthorized access by employees or contractors.

Several factors are accelerating adoption: 

• Organizations are investing more heavily in insider risk monitoring due to stricter privacy regulations, cyber-insurance requirements, and increased attention from executives and boards. 
• AI-powered behavioral analytics platforms are also improving detection accuracy while reducing the workload on security analysts. 
• At the same time, zero-trust initiatives and increased venture funding are helping expand insider threat programs beyond highly regulated industries.

Despite strong growth, organizations still face several challenges when building insider threat programs: 

• One major issue is the global cybersecurity skills shortage. Insider threat investigations often require experienced analysts who can interpret behavioral data and manage sensitive employee-related incidents.
• Privacy concerns also complicate deployment. Regulations such as GDPR require organizations to balance employee monitoring with legal protections around personal data and transparency. Some companies use privacy-preserving approaches like federated learning to reduce the amount of personal information collected, though these methods can sometimes reduce detection accuracy.
• Another challenge is budget prioritization. Some organizations continue to prioritize perimeter security tools over insider-focused solutions, especially in smaller businesses with limited security budgets.

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Types of insider threats

Malicious Insider

A malicious insider is someone who deliberately seeks to cause harm to an organization. This individual typically has authorized access and misuses it to steal sensitive data, sabotage systems, or otherwise disrupt operations. Motivations can include financial gain, ideological beliefs, revenge, espionage, or coercion. They may also aim to steal trade secrets for a competitor or for personal gain. Malicious insiders often plan their actions in advance and may evade detection by using their knowledge of internal systems and controls.

Negligent Insider

Negligent or mistaken insiders are the most common and frequently the most expensive source of insider incidents. Negligent insiders do not intend to cause harm but do so through careless or uninformed behavior. Examples include falling for phishing attacks, misconfiguring systems, uploading sensitive company data into unauthorized generative AI and shadow IT tools, or sending sensitive data to the wrong recipients. These users often ignore security protocols or underestimate the risks of their actions, making them a frequent source of data leaks and compliance violations.

Compromised Insider

A compromised insider is a legitimate user whose credentials or access rights have been hijacked by an external attacker. This can happen through phishing, malware, or credential stuffing. In many cases the insider is manipulated, tricked through social engineering or phishing campaigns into handing over credentials or granting bad actors access to corporate networks. Because the attacker uses valid credentials, their actions can be difficult to detect. Compromised insiders are especially dangerous because they often appear to be acting within their normal scope of activity.

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Why insider threats are so dangerous

Insider threats are notoriously difficult to detect because the actor already has legitimate, authorized access to the network, applications, and data. There are no perimeters to breach, so malicious or compromised activity can blend into normal day-to-day work and go unnoticed for weeks or months.

That head start also makes insider incidents expensive to contain and recover from. Industry research consistently puts the average annual cost of insider risk in the millions of dollars per organization, driven by stolen data, prolonged investigations, and remediation. Because negligent insiders account for the largest share of these incidents, early detection and behavioral monitoring are essential.

Insider Threats Take the Lead: Why Organizations Are Falling Behind

According to the report from Exabeam, From Human to Hybrid: How AI and the Analytics Gap Are Fueling Insider Risk, insider risks have now surpassed external threats as the leading concern for security teams. In our survey, 64% of cybersecurity professionals identified malicious or compromised insiders as a greater danger than outside attackers, compared to 36% who pointed to external actors. 

Within that 64%, 42% saw malicious insiders as the primary concern, and 22% cited compromised insiders. Over half (53%) reported insider incidents had increased in the past year, and 54% expect them to rise further in the next 12 months.

Detection capabilities remain underdeveloped. Only 44% of organizations are using user and entity behavior analytics (UEBA), which are critical for detecting abnormal activity. Although 88% say they have an insider threat program, many are informal, underfunded, or lack visibility across systems. Leadership alignment is also a gap: 74% of security professionals believe executives underestimate insider risk.

Generative AI is accelerating the problem. 76% of organizations have seen unauthorized use of GenAI tools by employees. AI-enhanced phishing and social engineering (27%) and unauthorized GenAI usage (22%) rank among the top insider threat vectors, alongside privilege misuse (18%). 

Security leaders acknowledge the need for better behavioral insight, but face technical and organizational roadblocks. Privacy resistance (20%), lack of visibility (16%), and fragmented tools (10%) create blind spots in detection efforts.Learn more by downloading Exabeam’s research report “From Human to Hybrid: How AI and the Analytics Gap Are Fueling Insider Risk.”

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Examples of Insider Threats 

Rippling

In March 2025, Rippling filed a lawsuit against rival company Deel, alleging a serious insider threat incident. The company accused Deel of placing a spy inside Rippling’s workforce under the guise of a Global Payroll Compliance Manager. Hired in 2023, the individual allegedly spent four months accessing confidential data through legitimate channels, including Slack, Salesforce, and Google Drive.

The data reportedly stolen included pricing strategies, customer lists, internal employee data, and competitive insights. The insider’s activity went undetected for months, raising concerns about the lack of real-time monitoring and behavioral analysis. Rippling argued that earlier detection might have been possible with tools that track abnormal access patterns or keyword searches related to competitors.

Verizon

In a September 2023 incident reported in early 2024, a Verizon employee accessed a file containing sensitive personal data of more than 63,000 individuals without proper authorization. The information exposed included names, addresses, Social Security numbers, compensation data, and union affiliations. Verizon confirmed the data breach to the Office of the Maine Attorney General and attributed it to unauthorized access rather than an external compromise.

While the company stated that the action did not appear to be malicious and did not involve law enforcement, the breach raised serious concerns. The incident highlighted how even non-malicious misuse of access can result in significant data exposure. It also underscored the importance of enforcing strict access controls and monitoring internal data usage, regardless of perceived intent.

Yahoo

In May 2022, Yahoo was hit by an insider threat attack. Qian Sang, a research scientist at the company, received a job offer from a competitor called The Trade Desk. Minutes later, Sang downloaded about 570,000 pages of Yahoo’s intellectual property to his personal devices, including information about Yahoo’s AdLearn product. 

It took Yahoo several weeks to realize that Sang had stolen company data, including a competitive analysis of The Trade Desk. Yahoo sent Sang a cease-and-desist letter and brought three charges against him, including intellectual property data theft, claiming that Sang’s actions divested Yahoo’s exclusive control of its trade secrets.

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Understanding the insider threat kill chain

Let’s see how insider threats happen: methods of compromise, and how insider threats use privilege escalation to do more damage.

How are employees compromised

There are several means by which an employee can become a compromised insider:

Pass-the-hash – a more advanced form of credential theft where the hashed – encrypted or digested – authentication credential is intercepted from one computer and used to gain access to other computers on the network. A pass-the-hash attack is very similar in concept to a password theft attack, but it relies on stealing and reusing password hash values rather than the actual plain text password, especially during RDP sessions.

• Phishing – a cybercrime in which a target individual is contacted via email or text message by someone posing as a legitimate institution in order to lure the individual into providing sensitive data, such as personally identifiable information (PII), banking and credit card details, and passwords. Some phishing schemes may also try to entice a target to click on a link that triggers a malware download.
• Malware infection – a cybercrime when a machine is infected with malicious software – malware – infiltrates your computer. The goal of the malware in the case of a compromised insider is to steal sensitive information or user credentials. A Malware infection can be initiated by clicking on a link, downloading a file, or plugging in an infected USB, among other ways.
• Credential theft – a cybercrime aimed at stealing the username and password – the credentials – of a targeted individual. Credential theft can be done in a variety of ways. Phishing and malware infection, mentioned above, are common. Some criminals may engage in social engineering, which is the use of deception to manipulate individuals into divulging their credentials. A bogus call from the IT helpdesk, where the user is asked by the attacker to confirm their username and password, is a common technique.

Insider threats and privilege escalation

Insiders can carry out their plans via abuse of access rights. The attacker may try what is known as privilege escalation, which is taking advantage of system or application flaws to gain access to resources they do not have permission to access.

In some cases, abuse of access rights takes the form of someone with privileged access abusing their power. In a historic case from 2008, a system administrator working for the San Francisco city government blocked access to the city’s network and refused to surrender the admin passwords. The worker was disgruntled, and his job was in jeopardy, it was revealed.

These complex threats cannot be detected with traditional correlation rules because they are unknown threats. Instead, a security analyst would need to understand the user’s normal activity to be able to identify abnormal and potentially malicious activity.

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How to find insider threats: key indicators

Organizations can spot or predict insider threats by observing user behavior in the workplace and online. Being proactive may allow organizations to catch potentially malicious insiders before they exfiltrate proprietary information or disrupt operations.

What behaviors can your organization use to identify insider threats?

Employee/Contractor Behavioral Trait	Organizational Event
Interest outside scope of their duties	Layoff
Working unusual hours without authorization	Annual merit cycle – individuals not promoted
Excessive negative commentary about organization	Annual merit cycle – individuals not given raises
Drug or alcohol abuse	Potential performance improvement plans, or workplace harassment complaints, and more
Financial difficulties
Gambling debt
Change in mental state	Potential performance improvement plans, or workplace harassment complaints, and more

Employee or contractor behavioral traits, and organizational events, that should be heeded to reduce the risk of insider threats.

What suspicious security events can indicate a possible insider threat? 

Behavior	Malicious Insider	Compromised Insider
Badging into work at unusual times	X
Logging in at unusual times	X	X
Logging in from unusual location		X
Accessing systems/applications for the first time	X	X
Copying large amounts of information	X	X

Behaviors that suggest malicious or compromised insiders.

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Six ways to prepare against insider threats

There are many things an organization can do to combat insider threats. Here are the four main areas to focus on.

1. Train your employees

Conduct regular anti-phishing training. The most effective technique is for the organization to send phishing emails to its users and focus training on those users who do not recognize the email as a phishing attempt. This will help reduce the number of employees and contractors who may become compromised insiders.

Organizations should also train employees to spot risky behavior among their peers and report it to HR or IT security. An anonymous tip about a disgruntled employee may head off a malicious insider threat.

2. Coordinate IT security and HR

There is no shortage of stories about IT security teams that were blindsided by layoffs. Coordination between the CISO and the head of HR can help prepare IT security. Simply putting affected employees on a watchlist and monitoring their behavior can thwart many threats. Likewise, HR may advise IT security about certain employees that were passed over for a promotion or not given a raise. Tuning data loss prevention (DLP) tools with active thought and input from HR may also give an early warning sign of both self-harm and disgruntlement in terms of the establishment.

3. Build a threat hunting team

Many companies have dedicated threat hunting teams. Rather than reacting to incidents after they are discovered, threat hunting takes a proactive approach. Dedicated individuals on the IT security team look for telltale signs, such as those listed above, to heed off theft or disruption before it occurs.

4. Employ user behavioral analytics

User Behavior Analytics (UBA), also known as User and Entity Behavior Analytics (UEBA), is the tracking, collecting, and analyzing of user and machine data to detect threats within an organization. Using various analytical techniques, UEBA delineates anomalous from normal behaviors. This is typically done by collecting data over a period of time to understand what normal user behavior looks like, then flagging behavior that does not fit that pattern. UEBA can often spot unusual online behaviors – credential abuse, unusual access patterns, large data uploads – that are telltale signs of insider threats. More importantly, UEBA can often spot these unusual behaviors among compromised insiders long before criminals have gained access to critical systems.

5. Deploy data loss prevention (DLP)

Set up automated controls to track and restrict how sensitive data moves across your network. Data loss prevention (DLP) tools can block confidential files from being downloaded, printed, copied to external devices such as USB drives, or emailed to personal accounts. This is one of the most effective ways to stop a malicious insider from exfiltrating intellectual property.

6. Adopt zero trust and least privilege

Give users access only to the exact data, applications, and networks they need to do their jobs, and enforce strong multifactor authentication (MFA). A zero trust approach assumes that no user or device is automatically trusted and verifies every request, which limits the damage a compromised or malicious insider can do.

Organizations that adopt a dedicated insider risk management framework, pairing these controls with clear policies and shared ownership across security, IT, and HR, can sharply reduce both the frequency and the financial impact of insider incidents. For sector-specific guidance, the Cybersecurity and Infrastructure Security Agency (CISA) publishes practical resources on defining and mitigating insider threats.

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