Majority of medium to large U.S. companies will have cyber insurance in the next year: survey

More than three quarters of mid-size to large companies in the United States will have cyber insurance coverage in the next year, suggests a new survey from Munich Re.

In the survey of more than 100 risk managers at the Annual Conference of the Risk and Insurance Management Society (RIMS), held Denver in April, 77% said they plan to have some level of coverage in the next 12 months.

Additionally, 42% said they plan to increase their level of cyber insurance or purchase cyber coverage for the first time.

The majority (82%) of those surveyed said they feel there are adequate policies available to meet their cyber coverage needs. Of the 23% that aren’t planning to buy cyber insurance, five out of six feel that current insurance offerings do not meet their needs or would not be relevant for their business, according to Munich Re.

“Risk managers recognize that there is an increasing possibility that their company will experience a breach or loss of data, regardless of the steps they take to secure this data,” Gerry Finley, senior vice president of Casualty Underwriting and Underwriting Services at Munich Re America said in a statement.

“They understand  that having financial protection is an important component of managing this increasing risk.”

Among the risk managers surveyed, 43% said they were reluctant to use or increase their use of cloud software because of certain data security risks. Hacking was a top concern at 29%, while theft of data (25%), loss of control over data (22%), loss of data (13%) and loss of access to data (11%) were also seen as major issues.

In terms of mitigating cyber risk, 42% of those surveyed said  that conducting regular network penetration tests or security audits is the best method.

Other tactics included:

• Hiring trained security personnel to handle the cyber exposure (16%)
• Conducting automated/centralized security patch updates (15%)
• Outsourcing IT applications and data warehousing (12%)
• Ensuring acceptable use of policies and procedures (9%)
• Purchasing insurance (7%)