95% of organizations that purchased a cyber insurance policy in the last year report a direct impact: Sophos

Sophos, a global leader in innovating and delivering cybersecurity as a service, today released a new report, “The Critical Role of Frontline Cyber Defenses in Insurance Adoption,” detailing how the quality of an organization’s cyber defenses impacts their insurability, premium costs and policy terms. Ninety-five per cent of organizations that purchased a cyber insurance policy in the last year report a direct impact: 60 per cent say it impacted their ability to get coverage; 62 per cent say it impacted the cost of their coverage; and 28 per cent say it impacted the terms of their policy.

The research also finds that cyber insurance adoption is now the norm with 91 per cent of organizations reporting having coverage, with an additional eight percent reporting they don’t currently have coverage but plan to obtain it in the next year. Insurance coverage, in turn, plays a role in an organization’s ability to recover from an attack:

* Organizations with cyber insurance are more likely to be able to recover data that was encrypted in a ransomware incident: 98 per cent of those with a standalone policy and 97% of those with cyber as part of a wider insurance policy were able to recover encrypted data after a ransomware attack, compared to 84 per cent of those without cyber coverage

* Organizations with standalone cyber insurance policies are almost four times more likely to pay the ransom to recover encrypted data than those without cyber coverage: of those that had data encrypted in a ransomware incident in the last year, 59 per cent of those with a standalone cyber insurance policy paid the ransom, compared with 37 per cent of those with cyber as part of a broader insurance policy and 15 per cent of those that don’t have cyber insurance

“The caliber of an organization’s cybersecurity defenses in protecting against active adversaries is critically important. Organizations need to properly configure and manage security technologies and also effectively respond to threats – and that requires an expert talent skillset,” said Raja Patel, senior vice president of products at Sophos. “Industry-first threat detection and response capabilities now enable Sophos to meet customers where they are and with exactly what they need to ensure superior security outcomes.”

Data from the report, “The Critical Role of Frontline Cyber Defenses in Cyber Insurance Adoption,” comes from an independent global study of 3,000 cybersecurity/IT professionals across 14 countries conducted in January and February 2023.