07 October 2016

Reuters: Fewer British firms have cyber insurance policies

The number of British firms insured against cyber threats has fallen sharply in the past year even though many doubled their security budgets after some high-profile companies suffered attacks, a survey by PwC showed.

The auditing and corporate advisory firm said companies were reluctant to invest in cyber insurance because they viewed products available as inadequate.

PwC interviewed 479 executives at British companies and only 38 percent said their company had a cyber insurance policy, down from 59 percent in a similar survey a year ago.

"The drop in take-up of cyber insurance shows that this is still maturing as a product," Domenico del Re, insurance director at PwC, said.

"Companies do not see the cover currently on offer as targeted to their individual risks and therefore not value for money."

The amount of cover insurers offer does not come close to the potential losses seen by companies from a truly damaging cyber attack, PwC said.

PwC  spoke to 14 specialist insurance companies in London to look at how the insurers view cyber risks.

Half of insurers who responded sell cyber policies, or see cyber insurance as an area of growth, while the other half do not actively pursue it, often believing the risk to be "borderline insurable".

Most of the insurers who offer cyber cover, however, still "tread carefully" and tend to limit the amount of cover offered under each policy.

British companies, which now spend about 6.2 million pounds ($7.9 million) on average on security, are also more likely than firms around the world to keep their cards close to their chest and not share security knowledge, PwC said.

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© Reuters