The majority of business decision-makers are insured against traditional cyber risks such as breaches of personal information, but are vulnerable to emerging risks like ransomware, according to a new study commissioned by The Hanover Insurance Group.
Most businesses surveyed by The Hanover’s Cyber Risk Report, conducted in conjunction with Zogby Analytics, said they had purchased cyber insurance, with more than 70% saying they had purchased a policy on the recommendation of an independent insurance agent. Respondents’ purchasing decisions were also largely driven by media coverage and prior attack experience. Nearly 90% of respondents reported experiencing a cyberattack during the past year.
Other key findings of the report included:
- The top cybersecurity fear for businesses was breach of personally identifiable information; however, malware-related attacks were the most commonly experienced cyberattack. One in two businesses experienced a malware-related attack in the last year, while fewer than one in five experienced a breach of personal information.
- 60% of businesses reported that they would be unprofitable in less than two days if they lost access to critical systems or data. Ninety-two per cent (92%) said they would experience a negative financial impact.
- More than 40%of businesses had no cyber insurance or limits of $1 million or less, which might not adequately cover the cost of an average cyberattack.
- Only 11% of businesses were concerned about cyberattacks affecting their supply chains, even though 88% said they were dependent on third parties.
“Having the appropriate cyber protection will only become more important as new technologies emerge, businesses become more connected and cyber criminals develop more sophisticated methods,” said Bryan J. Salvatore, president of specialty insurance at The Hanover. “As businesses grow in complexity, the advice of an independent agent becomes increasingly important in helping business owners understand the many risks they may face and mitigate those evolving threats.”