Cyber insurers paid 99 percent of claims received: study
Advisen
Cyber insurers paid 99 percent of claims received: study
By Erin Ayers, Advisen
Cyber insurers paid 99 percent of the claims they received in 2018, but too few businesses buy the coverage, according to new data from the Association of British Insurers, which urged the government to share data that could help in pricing insurance more effectively.
ABI reported that up to 89 percent of businesses remain uninsured against cyberattacks, despite the fast-growing cyber insurance marketplace. The group’s report noted that the 207 claims that were paid last year represents one of the highest claims acceptance rates across all insurance products.
Unfortunately, statistics show that based on premiums written, more people buy pet insurance in the United Kingdom than cyber insurance (less than 100 million pounds in the UK for cyber insurance versus 1.1 billion for pet insurance).
Overall, there may be many more worried pet parents than businesses in the UK, but the ABI noted that still just 11 percent of businesses have specific cyber coverage in place. This is at a time when cyber risk has increased enormously, with government data indicating that about 60 percent of medium-sized businesses and 61 percent of large businesses in the UK experienced cyber events in 2018. The National Cyber Security Centre’s Active Cyber Defence unit also reported that it took down a total of 192,256 threats during 2018.
That government data could help grow the market and protect more businesses, according to ABI. The insurers group renewed its call this week to the Information Commissioner’s Office (ICO) to provide anonymized breach data to insurers to help price more accurately, tailor coverage more effectively, and manage their own risk.
“Cyber insurance is a valuable product – the claims acceptance rates speak for themselves and the additional support a business receives, beyond dealing with the pure financial losses is a key attribute of most cyber insurance policies, too often overlooked,” said James Dalton, ABI director of general insurance policy. “Data is key to insurers’ ability to better understand and more accurately price cyber risk. We need the ICO to work with us to find what data can be shared to help insurers provide more cover to the many businesses that need it in this digital age."
The ICO, which recently fined both British Airways and Marriott record-breaking sums in connection with data breaches, has not agreed to provide any data to insurers.
Dalton noted that cyber insurance can protect buyers from a range of risks associated with cyberattacks, including business interruption, breach remediation costs, cyber extortion, damage to assets, media liability, and cyber forensic support.
Editor Erin Ayers can be reached at eayers@advisen.com.
