A significant portion of businesses around the world remain ill-equipped to handle mounting cyber risks, even as artificial intelligence (AI) strengthens the tools available to cybercriminals, according to new research from Beazley.
In Beazley’s “Risk & Resilience: Spotlight on Cyber & Technology Risk 2024” report, 26% of global executives identified cyber risk as their top concern this year, a drop from 34% in 2021. Alarmingly, 23% of business leaders admitted they felt unprepared to address these threats.
While 24% of global executives plan to boost their investment in cybersecurity, the same percentage intends to explore insurance options that offer both risk and crisis management services. The measures are considered essential in the face of increasingly sophisticated cyberattacks as a result of advancements in AI.
The report sheds light on how businesses view the risks associated with cybercrime, technological disruption, and intellectual property amid rapid innovation. Beazley’s survey of 3,500 business leaders globally revealed a worrying trend: 69% of firms believe their current cyber defences are adequate, even as cybercriminals continue to evolve their tactics.
With preparedness declining – only 75% of leaders feel resilient against cyber threats, down from 78% in 2022 – many businesses may be overestimating their ability to fend off attacks.
AI technology has provided significant benefits, allowing companies to streamline operations and enhance efficiency. Beazley’s research found that 25% of businesses are planning AI investments aimed at strengthening their resilience to various risks.
Additionally, 68% of leaders predict that AI will eventually replace jobs within their firms. Also, among global boardrooms, 27% ranked technological obsolescence as their primary concern for 2024, with 24% of executives acknowledging they are unprepared to handle this challenge.
In addition to its business applications, AI is reshaping the cyber risk landscape. Hackers are leveraging AI to enhance traditional attacks like phishing and developing new methods such as deepfake scams. The rapid evolution of these techniques makes it increasingly difficult for companies to detect and defend against threats.
Paul Bantick (pictured), Beazley’s global head of cyber risks, stressed the urgency for businesses to adopt comprehensive risk management strategies: “As our report shows, with technological innovation set to bring about seismic societal change, the growing regulatory burden for firms, and cybercriminals becoming more and more sophisticated, businesses are facing a wave of new threats.
“The need for robust risk mitigation strategies has never been greater, and insurance can play an important role. By leveraging the vast amounts of claims, incident, and threat information data we have and translating that into actionable guidance and advising on elevated ‘always on’ resilience for a range of cyber and technology risks, we can help clients to better navigate the risks they face today.”
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