Despite a series of high-profile cyber security cases in recent years, the uptake of cyber insurance among small-medium enterprises (SME) remains low at just 12.7%, according to GlobalData’s 2020 UK SME Insurance Survey. Insurers should target middle-market companies who at the most risk, according to GlobalData.
GlobalData Senior Analyst, Daniel Pearce, commented: “The pandemic has increased businesses’ reliance on technology in order to operate during lockdowns, while social distancing guidelines continue to promote home working. With this growing dependence on technology comes an increase in cyber risk.
“Given this, the need for cyber insurance has arguably never been higher. Traditionally, cyber insurance has seen greater levels of uptake and interest among mid-market and larger corporations, but the pandemic has accelerated the need for smaller business to purchase cover as well. “
Among SMEs operating in industries such as healthcare, manufacturing, real estate and education – which have been reported as being under greater threat – GlobalData research indicates that cyber insurance uptake is lowest within the health and social work sector, with 25.9% holding cyber insurance coverage.
Pearce added: “The health and social work sector will arguably have been one of the most directly and heavily impacted by the spread of COVID-19, and having had to respond directly to COVID-19’s effects on the population, the increased cyber threats it faces adds further concern.
“The insurance industry should use this as an opportunity to engage with the SME market in particular, as larger corporations will typically have cyber insurance in place. The impact that a cyber attack could have on a business of this size could be debilitating due to financial losses, and, given the reliance on technology during the COVID-19 pandemic, there is no better time to engage with prospective customers.”