Despite a data breach, numerous businesses opt against increasing their financial investment
In a recent development, Northdoor plc, a leading London-based IT consultancy specialising in data security, has released its 2021 insurance sector cyber security assessment report. The report sheds light on the growing concern of cyberattacks on key UK organizations and the response of the insurance sector to these threats.
According to the report, daily global cyberattacks exceed 2,200, with ransomware featuring in 44% of data breaches. This alarming trend is further highlighted by the IBM's annual 2024 Cost of a Data Breach report, which shows that the average cost of data breaches has hit a record high of $4.88 million.
AJ Thompson, the CCO at Northdoor plc, comments on the true costs of data breaches, stating that the decision not to invest in cybersecurity after a breach is deeply flawed. The report analyses over 150 companies across the insurance sector and found that 51% of companies do not plan to increase their security spending after experiencing a breach, a significant rise from 37% in 2024.
Thompson points to the rapidly evolving landscape of cyber threats as a key reason why companies must adapt their security measures. He emphasises the importance of investing in cybersecurity for survival in today's digital landscape, and companies that fail to do so are likely to face even more costly incidents in the future.
The report also focuses on how the insurance sector is responding to threats and where vulnerabilities lie. Thompson highlights the overlooked vulnerabilities within a company's supply chain, which can provide backdoor access to their systems. He recommends partnering with security consultancies for organisations facing resource constraints to bridge gaps in expertise and personnel.
The assessment uses the RiskXchange Cyber Risk Rating and is split across brokers, carriers, underwriters, and service providers. The report further states that companies using AI and automation in their security systems save an average of $1.9 million per breach compared to those without such technologies.
However, the report also reveals an alarming pattern of companies not investing in cybersecurity after a breach, despite the growing sophistication of cyber threats. Thompson concludes that this trend is a recipe for disaster and that companies must prioritise cybersecurity to protect their assets and maintain customer trust.
In conclusion, Northdoor plc's 2021 insurance sector cyber security assessment report provides valuable insights into the current state of cybersecurity in the insurance sector and offers recommendations for companies to improve their security measures. The report underscores the importance of investing in cybersecurity for the survival of businesses in today's digital landscape.
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