The question – in the face of frequent cost-related concerns – is why this coverage is the right choice. Despite the swelling of premiums for 75 percent of Delinea’s respondents – with 86 percent of those noting a 50 to 100 percent jump in yearto-year cost – organizations are still buying in increasing numbers. Delinea noted that companies are insuring their digital assets at a very high rate for many reasons. And while many assume that an uptick in new forms of cyber attack are the biggest culprit, 68 percent of those surveyed said they did not buy a policy in response to any specific “security breach or incident.” There are different factors in play. Other reasons, as cited by Delinea, include risk reduction (40 percent), mandates from higher-ups or the board (more than 30 percent) and – hovering in at around 20 percent each – business contract terms, supply chain requirements and compliance. Exposure to attacks such as ransomware or a data breach also fell around this number. Interestingly, Delinea also noted that 95 percent of those whose cyber insurance coverage was mandated by another source received some form of “additional budget” in order to help meet that threshold. Of that amount, nearly 80 percent had their cyber insurance terms “fully covered.” Ultimately, cyber insurance can be a great ally in recovering from an attack, restoring capabilities and keeping businesses churning with fewer disruptions. According to Delinea, almost 80 percent of businesses have had their hand forced into cashing in on a policy, with just more than half of that segment having had to do so “multiple times.” It can be a nightmare scenario for most businesses, as there could undoubtedly be huge losses in their future. Where insurance helps is in seeking to minimize this damage and restore that which is lost. For those who responded to Delinea’s questionnaire, the key question becomes exactly how much coverage their specific policies extended to them during their time of need. Approximately 70 percent reported that their cyber insurance failed to offer coverage of any sort when, for example, paying out a ransomware scam. More troublingly, about 60 percent of policies fail to provide adequate coverage to recuperate cost related to identity or credit theft, incident response, asset replacement, regulatory fines or other third-party damages. More shockingly, just under half of insurance policies will not cover finances lost as a result of all-too-necessary data recovery options. Critical Coverage Areas Armed with the knowledge of what some cyber insurance policies will not cover, Delinea noted several key areas of focus for which organizations should seek to obtain coverage, if possible: Critical Data Recovery – Restoring or regaining access to files and sensitive information that are lost through cyberattack or natural disaster. Identity and Credit Fraud Monitoring – Addressing the threat that compromised data can be used for future, fraudulent aims. Increasing Cybersecurity Technology Presence – Obtaining necessary funds to raise your own capabilities to prevent attacks. Incident Response-Related Tasks – Resources to help more quickly and effectively respond to threats. Critical Hardware/Software Replacement – Maintaining infrastructure investment after some is compromised. Regulatory Fines – Helping cover the cost of fees incurred when, for example, sensitive data falls into the wrong hands. It’s a problematic scenario for sure. No company wants to fall victim to costly cybercrime. There are surfacelevel issues at stake such as the loss of revenue, the cost of recovery and the potential fines you may incur. Digging deeper, there is also potentially far more costly damage to your Global Cyber Insurance Market ($bn), 2015-2025 Source: GlobalData $ $5 2015 2016 2017 2018 2019 2020 2021f 2022f 2023f 2024f 2025f 80% 70% 60% 50% 40% 30% 20% 10% 0% $10 $15 $20 $25 $20.56bn $16.86bn $13.73bn $11.09bn $8.92bn $7.01bn $5.25bn $5.05bn $4.75bn $3.53bn $2.02bn 74.6% 34.56% 6.3% 3.9% 33.5% 27.3% 24.3% 23.8% 22.8% 22.0% Total Growth rate 34 CHANNELV ISION | JANUARY - FEBRUARY 2023
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