Marsh predicts cyber insurance rush

By Emmanuel Kenning

Broker claims more than half of businesses surveyed will buy or seek quotes for cyber insurance in the next 12 months.

A survey of businesses across the UK and Ireland by Marsh has found that only 32% of respondents' organisations have assessed the estimated financial impact of a cyber attack and only 14% have a policy in place.

However the broker's findings also revealed that more than half of those surveyed plan to buy or seek quotations for cyber insurance within the next 12 months.

The UK & Ireland 2014 Cyber Risk Survey Report, published by Marsh, detailed that cyber risk now features prominently on the corporate risk registers of organisations across the UK and Ireland.

One quarter (24%) of respondents placed the risk in the top five they face and over half (56%) placed it in their top ten.

Despite the figures, Marsh's research found that cyber risk is managed and reviewed at board level in just 20% of respondents' organisations with 57% of respondents stating that the overall responsibility for the assessment and management of cyber risk lies with their IT departments.

Catastrophic impact
Stephen Wares, cyber risk practice leader, Europe, the Middle East and Africa, Marsh, commented: "For those organisations that cited the board as the primary risk owner, there is recognition within these businesses of the potentially catastrophic impact that cyber risk may have on their revenues and reputations.

"Increased board-level ownership will accelerate efforts to understand how cyber risk affects organisational risk profiles, and will foster the adoption of more sophisticated risk mitigation measures. It will also improve the ability of companies to secure correctly targeted insurance protection at attractive premiums, should they decide to transfer some of the risk to the insurance market."

He concluded: "Marsh's data suggests a significant rush to market in the next 12 months, representing a considerable increase in active engagement with this class of insurance. Nearly twenty years after the first cyber policies were offered, cyber insurance has finally come of age and is now recognised by prospective buyers as delivering valued protection."

Source Insurance Age