Business Insurance

Cyber insurance covers only 2 percent of large UK businesses

A recent report issued by the British government showed that big firms rarely purchase this coverage.

The British government released a report, this week, that revealed that among large companies, only 2 percent have separate cyber insurance coverage against digital security and data breaches.

That number drops nearly to zero percent when it comes to the same coverage for smaller businesses.

The report was a response to the concerns that have been voiced with regards to the lack of cyber insurance protection for the majority of companies, in an environment where the chances of experiencing a data breach or other form of cyberattack are rapidly on the rise. These attacks have been costing billions of British pounds to the economy in the United Kingdom, said the report. The study was published in conjunction with the Marsh insurance broker.

The recommendation in the report was to encourage a far greater adoption of cyber insurance policies.

cyber insurance online computer data breachThe cyber insurance report was based on data from the insurance industry as well as additional information from that specific sector. The purpose was to help to increase the percentage of companies that recognize the potential benefit of carrying this additional coverage. Among all of the business leaders that were interviewed in order to obtain the necessary data for the report, half had said that they were not even aware of the existence of this type of insurance policy. This, despite the fact that many companies list cyber attacks as one of the largest risks that they could face.

The report stated that “Cyber attacks against UK companies present a daily threat to normal UK business operations and are increasing in severity.” The publication was the result of a project put together by a working group that was established in November of last year. Its recommendation was that more data and information be shared among the Association of British Insurers, the Lloyd’s of London insurance market, and the government.

At the same time, it also pointed out that it did not feel that direct financial support from the government would be required within the cyber insurance market, in order to ensure that adequate adoption levels are established.

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