Insurers have paid out almost £200million to help businesses recover from cyber attacks.
Figures from insurance industry trade body the Association of British Insurers show £197million was paid out to help businesses recover from cyber incidents last year.
Data from ABI member insurers revealed a 230 per cent year-on-year jump in the amount paid out to support businesses with cyber attacks, £138million more than in 2023.
Malware and ransomware alone accounted for over half of all claims by businesses.
This is up from a total of 32 per cent of all claims in 2023 as digital threats become increasingly sophisticated and causing more extensive damage, leading to higher payouts.
Marks & Spencer was the target of a massive cyber attack earlier this year, with Jaguar Land Rover and the Co-operative Group among other high-profile victims.
M&S was forced to suspend online shopping for two months afterwards, with click and collect orders suspended for almost four months.
M&S was the target of a massive cyber attack earlier this year that forced it to suspend online shopping for two months
In its latest results, M&S revealed statutory profit before tax – reflecting all costs for a period – slumped 99 per cent from £391.9million to £3.4million for the first half of the year, compared with the previous year.
M&S also said it had received £100million of insurance payouts related to fighting the cyber attack.
Meanwhile the Jaguar Land Rover cyber incident which happened in August has been described as ‘the single most financially damaging’ incident of its kind to ever hit Britain.
The ABI data shows how insurers can support businesses when a cyber attack halts business operations.
Now the insurance industry body is calling for cyber insurance to become a part of every company’s risk management strategy.
It can help to protect businesses from costly breaches, ransomware, and email compromise while helping them prevent attacks and boost resilience.
With cyber threats escalating, demand for cyber protection surged in 2024. The number of policies taken out rose 17 per cent compared to the previous year.
Jonathan Fong, head of general insurance policy at the ABI, said: ‘Cyber insurance is more than just a financial safety net.
‘The right policy not only supports businesses in the aftermath of an incident but can also help prevent attacks through access to expert advice, threat monitoring, and incident response planning.
‘With cyber threats continuing to grow in scale and sophistication, it needs to be a critical component of every organisation’s modern risk management strategy.’
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