Sophos‘ survey “Cyber Insurance and Cyber Defenses 2024: Lessons from IT and Cybersecurity Leaders” found that 97% of cyber policyholders invested in improving their defenses to help with insurance, with 76% qualifying for coverage, 67% obtaining better pricing, and 30% securing improved policy terms. However, recovery costs from cyberattacks are outpacing insurance coverage, with only 1% of claimants reporting their carrier funded 100% of the costs. The most common reason for not paying for full costs was due to the total bill exceeding the policy limit. The State of Ransomware 2024 survey also revealed a 50% increase in recovery costs following ransomware incidents over the last year.
“The Sophos Active Adversary report has repeatedly shown that many of the cyber incidents companies face are the result of a failure to implement basic cybersecurity best practices, such as patching in a timely manner. In our most recent report, for example, compromised credentials were the number one root cause of attacks, yet 43% of companies didn’t have multi-factor authentication enabled,” said Chester Wisniewski, director, global Field CTO.
“The fact that 76% of companies invested in cyber defenses to qualify for cyber insurance shows that insurance is forcing organizations to implement some of these essential security measures. It’s making a difference, and it’s having a broader, more positive impact on companies overall. However, while cyber insurance is beneficial for companies, it is just one part of an effective risk mitigation strategy. Companies still need to work on hardening their defenses. A cyberattack can have profound impacts for a company from both an operational and a reputational standpoint, and having cyber insurance doesn’t change that.”
Across the 5,000 IT and cybersecurity leaders surveyed, 99% of companies that improved their defenses for insurance purposes said they had also gained broader security benefits beyond insurance coverage due to their investments, including improved protection, freed IT resources, and fewer alerts.
“Investments in cyber defenses appear to have a ripple effect in terms of benefits, unlocking insurance savings that organizations can be diverted into other defenses to more broadly improve their security posture. As cyber insurance adoption continues, hopefully, companies’ security will continue to improve. Cyber insurance won’t make ransomware attacks disappear, but it could very well be part of the solution,” said Wisniewski.
Data for the Cyber Insurance and Cyber Defenses 2024: Lessons from IT and Cybersecurity Leaders report comes from a vendor-agnostic survey of 5,000 cybersecurity/IT leaders conducted between January and February 2024. Respondents were based in 14 countries across the Americas, EMEA and Asia Pacific. Organizations surveyed had between 100 and 5,000 employees, and revenue ranged from less than $10 million to more than $5 billion.
Read the complete “Cyber Insurance and Cyber Defenses 2024: Lessons from IT and Cybersecurity Leaders” on Sophos.com for additional global findings and data by sector.
