Less than half (41 percent) of firms are fully insured for both security breaches and data loss, and only a third have dedicated cybersecurity insurance.
This is according to the 2016 Risk:Value report from NTT Com Security, which questioned 1,000 non-IT business decision makers in organisations in the UK, US, Germany, France, Sweden, Norway and Switzerland. In the UK, 200 organisations were questioned as part of the report.
Cyber insurance is a potentially huge market, and annual gross written premiums are estimated to grow from around $2.5 billion in 2015 to reach $7.5 billion by the end of the decade, according to consulting firm PwC.
While cyber liability insurance has become increasingly popular and can include cover for data/privacy breaches, extortion liability and network security liability, only 35 percent of businesses currently see the need to take a policy out, although a further 43 percent are getting one or thinking about it.
Businesses in the US are most likely to have this type of insurance – 51 percent compared to just 26 percent in the UK. Notably, wholesale organisations (43 percent) are more likely to take out dedicated cyber insurance, together with business/professional services (43 percent) and utilities companies (39 percent).
Less than half (46 percent) of those respondents whose organisation has company insurance that covers data loss or a breach, expect it to cover legal costs. Fewer expect it to cover regulatory fines (43 percent), government fines (41 percent) and remediation (41 percent). Covering loss of business and loss of IP (intellectual property) is even less likely, according to the report, at just 25 percent.
“Faced with risks every day, it’s easy for organisations to look for quick-fix solutions rather than focusing on building a solid security and risk management strategy,” says Garry Sidaway, SVP security strategy and alliances, NTT Com Security.
“Rather than relying solely on an insurance policy to cover losses, businesses need a different game plan. Buy insurance by all means, but insurers need to know what they are insuring and that the controls have been put in place to protect assets – this is the only way they can agree on cover.”
@AntonySavvas
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