The ferocity of cyber-attacks and their impact on businesses has brought upon the soaring premiums of cyber insurance. Here’s what you need to know about cyber threats, insurance, and how to control the premiums while staying safe online.
From our blog at Insider Media.
Recent studies indicate that global incidences of ransomware attacks have risen 235% in 2021 compared to 2019. This is in line with projections that cybercrime is predicted to top US$10.5 trillion by 2025. With these figures, cyber insurance premiums continue to increase in proportion to the astronomical risks faced by businesses today.
To compound this situation, there isn’t really a way to circumvent the omnipresent threat of cybercrimes in modern business operations. During WEF’s Davos 2022 conference one of the key themes discussed was a digital future. UN Development Programme Administrator Achim Steiner notably said, “Our future is digital. If you’re not part of it, you’re out of it.”
Simply put, it is imperative for businesses to embrace digitalisation to future-proof their commercial interests. The only way to work in the omnipresence of cyber threats today is to address them head-on. Comprehensive and dynamic cybersecurity measures coupled with robust cyber insurance create a safe financial moat for the most intense circumstances.
This emerging trend comes as no surprise with cybercrimes being so ‘lucrative’ to the faceless but highly organised breed of perpetrators today.
2022 CYBERSECURITY THREAT LANDSCAPE
During METCLOUD’s recent Cyber Security and Insurance Webinar, was shared that those threat actors today no longer operate in isolation. Today’s cybercriminals are part of a mature and functioning cybercrime ‘market’ with specialised modular products being sold or rented.
In short, today’s cybercriminals are far more insidious than their mischief-making predecessors. They collaborate to deliver the most crippling blow to the target organisation with the intention to grind operations to a halt until their demands are met. The ransomware modus operandi has proven to be so ‘successful’ to perpetrators that studies have indicated a notable decrease in malware while ransomware attacks skyrocket. Other findings include:
- The most targeted industries are financial, insurance, public administration, and healthcare however it is essential to note that all businesses are at risk.
- 44% of breaches in the financial sector are caused by internal errors
- Most UK businesses lack staff with expertise in technical, incident response, and governance
- The best way to mitigate cyber risks is to develop and maintain a robust pre-emptive cybersecurity plan that also includes regular employee training, protection from spam, malware, and two-factor authentication.
Understanding Cyber Insurance
Cyber insurance protects an organisation from online threats that can include data breaches, hacking or ransomware attacks. Covering cyber liabilities is a necessity and insurance premiums are becoming more costly with risks and stakes being higher than ever before.
As businesses are responsible for their own cybersecurity and the aftershocks of an attack, cyber insurance is aimed to provide the necessary support and cost recovery.
Some of the key factors driving cyber insurance premiums up are claims, data protection legislation, and poor risk management. Poor risk management is evidenced by some of the top causes for claims which include human error, data breaches, and rogue employees.
While businesses should look to robust cyber insurance to protect their financial health in the event of a malicious attack, the best way to moderate the steep premiums is to demonstrate good risk factors. They include:
- Regular back-up of business-critical data in a geo-redundant location
- Robust data access policies and multi-factor authentication
- Regular (or at the very minimum annual) cyber security training
In short, prevention is better than cure. Cyber insurance should give your business the means to deploy your ‘infantry’ when under attack. However, infantry can’t go far without the appropriate guards and weapons. This is where robust cybersecurity comes in.
Better safe than sorry – start with robust protection
The omnipresence of today’s cyber threats means that businesses of any size cannot have a linear, one-dimensional approach to cyber protection. While dynamic and ongoing cyber-surveillance is the standard today, it can seem unattainable and too costly for many growing businesses to adopt in-house.
The most cost-effective way to help moderate costly premiums while protecting the business online would be to investigate a computing firm that provides a suite of cyber-secure cloud computing services. While different businesses may require different levels of protection, a good start is to seek Security Operations Centres as a Service (SOCaaS), as well as Back-up as a Service (BaaS).