CFC Underwriting has revealed it has seen 107% growth in new cyber insurance business in Australia over the past year.
According to the specialist firm, the introduction of the Notifiable Data Breaches (NDB) scheme was the key driver in the take-up.
“We attribute much of this growth to awareness of the impending legislation surrounding notification, along with greater understanding of how policies respond in providing costs to manage such incidents,” CFC international cyber team leader Lindsey Nelson said.
“Australian businesses increasingly recognise that cyber insurance policies provide post-remediation services to formulate incident response planning proactively as well as employee training tools to prevent human error related scenarios – something that the Office of the Australian Information Commissioner (OAIC) highlighted in its report as a key factor in reducing the risk of a data breach.”
CFC data indicates that human error related events make up the majority of its claims by frequency accounting for 75% of claims activity. This includes cyber-crime scenarios such as social engineering, phishing attempts, ransomware and lost portable devices containing sensitive information.
“Those insurers with specialist knowledge of cyber security and forensics can help prevent policyholders’ claims costs from escalating as well as ensure the organisation’s reputation doesn’t suffer unnecessarily,” Nelson added.