The Good, the Bad, and the Necessary State of Cyber Insurance
New data from security vendor Sophos shows that while the presence of cyber insurance coverage has increased, it’s the experiencing of attacks that’s driving the need.
When the concept of cyber insurance was first introduced, it seemed like a shakedown and just another way for insurers to take the organization’s money. But today, according to Sophos’ just released Cyber Insurance 2022: Reality from the Infosec Frontline report, cyber insurance policies are now held by 94% of organizations.
So, what’s driving this adoption of cyber insurance?
Much of the adoption lies in organizations experiencing an attack and realizing they need insurance to potentially cover what their own cybersecurity stance doesn’t. According to the report:
- 57% of respondents experienced an increase in the volume of cyberattacks on their organization
- 59% saw the complexity of these attacks increase
- 53% said the impact of these attacks had also increased
- 89% of those hit by ransomware have cyber insurance against ransomware
It also appears to be the prevalence of attacks and the massive impact they have on their victims, as 70% of organizations not hit by ransomware still have cyber insurance against it.
And it’s getting more difficult to obtain cyber insurance, as insurers evolve their understanding of what is a secure insured and what is not. According to the report:
- 94% of those with cyber insurance said the process for securing coverage had
- changed over the last year.
- 54% say the level of cybersecurity they need to qualify is now higher
- 47% say policies are now more complex
- 40% say fewer companies offer cyber insurance
- 37% say the process takes longer
And even if you get a policy, there’s no guarantee the attack scenario you encounter is covered, as many organizations have needed to go to court over being paid out based on their policy.
So the best plan is to have as secure an environment as is possible – which includes securing your users with continual Security Awareness Training to minimize the threat of email- and web-based social engineering attacks designed to give attackers entrance into the organization’s network.