Quality of cyber defences directly Impacts insurability, premium costs, and policy terms, said Sophos recently.
According to the firm’s new report “The Critical Role of Frontline Cyber Defenses in Insurance Adoption” based on a survey of 3,000 cybersecurity or IT executives earlier this year, 95% of organisations that purchased a cyber insurance policy in the last year report a direct impact, with 60% indicating that it impacted their ability to get coverage, 62% the cost of their coverage, and 28% the policy terms.
“The quality of cyber defences in protecting against active adversaries is critically important,” said Raja Patel, senior vice president of products at Sophos. “Organisations need to properly configure and manage security technologies and also effectively respond to threats – and that requires an expert talent skillset.”
The research also finds that cyber insurance adoption is now the norm with 91% of organisations reporting having coverage, with an additional 8% reporting they don’t currently have coverage but plan to obtain it in the next year.
According to Sophos, insurance coverage plays a role in an organisation’s ability to recover from an attack in the following ways.
- Organisations with cyber insurance are more likely to be able to recover data that was encrypted in a ransomware incident: 98% of those with a standalone policy and 97% of those with cyber as part of a wider insurance policy were able to recover encrypted data after a ransomware attack, compared to 84% of those without cyber coverage.
- Organisations with standalone cyber insurance policies are almost four times more likely to pay the ransom to recover encrypted data than those without cyber coverage: of those that had data encrypted in a ransomware incident in the last year, 59% of those with a standalone cyber insurance policy paid the ransom, compared with 37% of those with cyber as part of a broader insurance policy and 15% of those that don’t have cyber insurance.