One in five businesses in the UK have been hit by a cyberattack in the past year, according to new research by Aviva.
Aviva’s study, covering over 1,200 businesses of varying sizes and industries, looks into trends in cyber resilience. It found that businesses are more likely to encounter a cyber incident than a physical theft and nearly five times as likely to experience a cyberattack than a fire.
Despite this elevated risk, a cyber insurance coverage gap has prevailed across industries, with only 36% of businesses reporting that they have some form of cyber cover.
“The low take-up of cyber insurance, coupled with the relatively high incidence of an attack, highlights the serious nature of the cyber risk facing businesses,” said Aviva cyber head Stephen Ridley in an emailed news release. “There is a compelling need for brokers to help educate their clients about the evolving risk of cyber and the need for businesses to protect themselves.”
The study also shed light on the disparity in cyber insurance adoption among different business scales. Mid-market businesses were in the lead with 51% having coverage, followed by large corporates at 45%.
As for small businesses, less than one in five (17%) said they have a cyber insurance policy, and an equivalent proportion said they were unaware that such coverage even exists.
Moreover, only 30% of surveyed businesses had reviewed their cyber insurance within the last year, with this figure dropping significantly to 16% among small businesses.
While the uptake of cyber insurance has remained relatively low, 56% of businesses expressed confidence in their cyber security measures. However, only 51% of respondents claimed to know what steps to take in the event of a cyberattack. Among small businesses, only 39% of those surveyed reported the same thing.
Loss of data (54%), malware attacks (46%), and operational disruption (43%) topped the list of businesses’ concerns about cyberattacks.
Among those that have experienced an attack, business interruption emerged as a prevalent issue, with 31% reporting operational disruption and 21% facing data loss and system lockdowns.
The financial repercussions were also found to be significant, with affected businesses claiming an average of £21,000 per incident, according to Aviva’s findings.
Additionally, nearly all businesses (97%) that suffered a cyberattack have taken steps to enhance their cyber security.
Responding to the study’s findings, Aviva has introduced an accredited training programme aimed at teaching brokers about cyber risks and available insurance options with clients.
The insurer has also launched the ‘Campaign in a Box’ initiative, which provides brokers with marketing tools to educate clients on cyber risks and protection measures.
“Cyber insurance must now be considered as essential as property and liability insurances – and brokers play an integral role in helping their customers close the protection gap,” said Ridley. “The challenge for insurers and brokers is to work together to engage businesses and ensure that they are protected from this emerging risk.”
Aviva recently launched a new cyber insurance policy tailored for micro-SMEs. Cyber Respond provides breach response services and is priced at £50 per year.
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