As businesses of all sizes realise the importance of taking cyber security seriously, the cyber insurance market has seen rapid growth over the past few years.
In this post we’ll provide a brief survey of how the cyber insurance landscape looks as we enter the final months of 2023.
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Cyber Insurance Statistics Showing the Severity of Claims is Rising
WTW published a comprehensive cyber insurance market update at the start of 2023. Their data-driven insights suggest that the severity of cyber insurance claims is rising all the time.
While small businesses remain most at-risk of most types of cyber-attacks, cyber criminals appear to be getting braver. Large enterprises are now prime targets for ransomware attacks.
The insights reveal:
- Third parties are responsible for 43% of data breach losses. For example, suppliers who store data on clients or employees on behalf of other companies.
- Ransomware attacks cost businesses more than they might imagine. The initial ransom payment accounts for just 16% of the overall costs. On average, 50% of the business costs associated with a ransomware attack relate to operational or trading cost losses.
- In the first quarter of 2023, 45% of ransomware attacks had an initial ransom demand in excess of $1 million. This represents an all-time high.
Official Government Cyber Security Statistics
The UK Government published its 2023 cyber security breaches survey in April. Their insights reveal:
- 32% of businesses and 24% of charities had experienced data breaches or cyber attacks in the previous 12 months.
- The threat for larger businesses is growing. 59% of medium businesses, 69% of large businesses, and 56% of large income charities had experienced significant cybercrime events.
- Regardless of the size of the business, a single breach can cost businesses an average of £1,100. For medium and large businesses, a single breach costs around £4,960. For charities, it’s around £530.
How These Statistics Affect Your Business
IT security and cyber security have never been “nice-to-haves”, and cyber insurance has never been something a business gets “just in case”. But the latest statistics should make it clear that the risk of cybercrime has never been so severe. 2023 has highlighted that no business is too big, or too small, to fall victim to a cyberattack.
The government figures allow us to put a price on the average cost of a ransomware attack. Depending on the size of your business, it could be between £1,000 and £5,000. But the WTW insights suggest that this will be just a small part of the overall price you pay. In terms of damages to your operations, your sales, and potentially your reputation, cyberattacks could cost you more than you might ever imagine.
And unfortunately, the future will only bring more risks. Artificial intelligence (AI) will give cybercriminals faster and more powerful than ever. Businesses of all sizes will have to invest significantly in cybersecurity if they’re to remain vigilant and resilient in 2024 and beyond.
The Importance of Cyber Insurance
As part of your overall duty of care to your business, you must take all necessary steps to safeguard the security and integrity of your systems and your data. As part of this, you must invest in flexible and intelligent cyber insurance.
In the event of a cyberattack, cyber insurance will cover your business’s liability as well as your ability to manage the impact on both your systems and finances.
If you have any questions about business insurance, or if you want to discuss whether cyber insurance is right for you, we have a team of experts ready to help. Call us on 0208 290 9080 or email us at firstname.lastname@example.org.