Cyber insurance rates falling globally despite rising ransomware attacks

Cyber insurance rates are falling globally despite rising ransomware attacks, as reported by Reuters on 1st July 2024. Broker Howden indicates that premiums are declining.

During the COVID-19 pandemic, cyber attack incidents surged, causing insurance premium rates to skyrocket in 2021 and 2022 as businesses sought protection from hackers. However, rates have dropped by a double-digit percentage since last year.

The decrease in rates can be attributed to companies’ improved cyber crime prevention measures, such as Multi-factor Authentication (MFA), which requires users to provide two or more verification factors to access resources and protect sensitive data.

Sarah Neild, Head of UK Cyber Retail at Howden, emphasized the importance of MFA: “MFA is the most basic thing you can do; it’s like locking the door when you leave the house.” Neild also noted that insurers’ increased willingness to offer coverage has contributed to lower prices.

Following Russia’s invasion of Ukraine in February 2022, global ransomware attacks decreased as hackers from affected regions focused on military operations. Nonetheless, the report indicates an 18% increase in recorded ransomware incidents in the first five months of 2024 compared to the previous year.

According to the report, the most significant cost for businesses affected by cyber attacks is business interruption. Businesses can mitigate this costly threat by adopting cloud services to enhance backup systems.

However, smaller firms are less likely to purchase cyber insurance, often due to insufficient awareness of cyber risks.

Reference: https://www.reuters.com/technology/cybersecurity/cyber-insurance-rates-fall-businesses-improve-security-report-says-2024-06-30/

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Article by Wannakorn Thongkaow