Insurance broker urges businesses to check their cyber insurance as ransomware attacks continue to rise

With ransomware attacks on the rise once again, one of the UK’s leading insurance brokers, Towergate Insurance Brokers, is urging businesses to check their cyber insurance to make sure they have adequate cover in case they are targeted.

Ransomware attacks have been increasing since the start of 2023, after worldwide figures dropped in 2022, likely due to the Russian invasion of Ukraine and the large number of attacks generated in that region.

Ransomware is a malware designed to deny a user or organisation access to files on their computer system. By encrypting these files and demanding a ransom payment for the decryption key, cyber-attackers place organisations in a position where paying the ransom is the easiest and cheapest way to regain access to their files.

Robert Lewis, Corporate Broking Director Towergate Insurance Brokers, said, “When it comes to ransomware attacks, we ask clients how they would respond. Do they have the expertise or financial resources to deal with an attack? If the answer is ‘no’, I say unequivocally that they need to investigate a specialist insurer.

“These aren’t attacks being carried out by one man and his laptop, they are sophisticated businesses using advanced technology to target many organisations at once. This is such a rising threat that it really is imperative that businesses work with a broker who has a thorough understanding of the risks and options available.

“It might sound obvious, but I would strongly urge people not to automatically go for the cheapest premium. First and foremost, people need to check the limit before signing anything.

“There are cases where insurers don’t pay out in the event of a loss due to a simple breach of conditions which could’ve been avoided had the business received better advice.”

Another vital consideration is the reputational damage caused by falling victim to one of these attacks. Recent research carried out by Object First shows that 40% of consumers harbour scepticism regarding organisations’ data protection capabilities and 75% would shift their business to alternate companies following a ransomware attack.

Robert said, “This impact on a business’s reputation is key. Some insurance could cover the immediate costs but what is the lasting damage? Prevention is definitely better than cure but there are also insurance policies that will offer crisis communications support which could be invaluable in these situations.

“Cyber-crime is here to stay and a massive threat to individuals and organisations UK-wide. Despite evidence that it can happen to anyone, people are still convinced that these attacks won’t happen to them.

“Cyber-criminals and the threat that they pose are constantly evolving. I would strongly urge anyone who isn’t sure where their business insurance stands to speak to an expert broker today.”

Towergate Insurance Brokers is one of the UK’s leading independent insurance brokers and risk management advisors. Boasting an experienced team of insurance specialists, Towergate Insurance Brokers has built a solid reputation for understanding many business sectors and industries, and the everyday risks they face in today’s increasingly complex world. They also look after the insurance needs of private individuals and families seeking tailored personal covers.

Towergate Insurance Brokers is a trading name of Advisory Insurance Brokers Limited.

Registered in England No.4043759. Registered Address: 2 Minster Court, Mincing Lane, London, EC3R 7PD.

Authorised and regulated by the Financial Conduct Authority.