Allianz Global has claimed in its report that cyber-crime costs UK businesses about £2.8 billion annually, and also accounts for 16 percent of gross domestic product (GDP). The global economy also feels the impact with £289.6 billion annual costs.
Due to these numbers, the cyber-security insurance sector is predicted to be worth more than £13 billion worldwide by 2025. According to the report, risks are growing way beyond privacy issues.
As of now, only 10 percent of UK companies have a cyber-specific policy. This number is set to increase in line with threats. Even once a policy has been purchased, a company must still manage the technological, operational and insurance aspects of the extended risks.
Chris Fischer, CEO of Allianz Global Corporate and Specialty (AGCS), said, “With increasing interconnectivity, globalisation and the commercialisation of cyber-crime there has been an explosion in both frequency and severity of cyber-attacks. Cyber insurance is no replacement for robust IT security but it creates a second line of defence to mitigate cyber incidents.”
Risks are a growing complexity, with future threats coming from intellectual property threat, cyber extortion and business interruption (BI) in the aftermath of an attack.
Georgi Pachov, cyber expert in AGCS's global property underwriting team said, “Within the next five to 10 years BI will be seen as a key risk and a major element of the cyber-insurance landscape.”This story originally appeared in SCMagazineUK.com.