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December 7, 2015

5 shocking numbers behind the SME cyber insurance market

List: The SME sector is seriously exposed to cybercrime risks.

By Ellie Burns

SMEs are overlooking the clear and present danger of cyber risks, with virtually no change in insurance uptake from Spring 2015.

This comes in spite of many high-profile public cyber attacks and breaches such as TalkTalk, and at a time when the UK government is set to double UK funding to £1.9bn to fight cyber crime.

Letting the figures illustrate the very real problem in the SME market, CBR looks at the SME cybercrime landscape using new research from Aon Risk Solutions.

 

22%

22% of UK SMEs have no insurance in place at all.

 

4%

Just 4% of UK SMEs said they had insurance cover in place to help protect them from the implications of cyber attacks, virtually no change from Spring 2015 (3%).

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Only 5% said they had cover for crisis management situations (including terrorism, ransom and product contamination).

 

5%

When it came to the sectors most at risk, IT & Telecoms topped the rankings, with just 5% of SMEs having policies to insure them against cyber attacks.

Following closely behind was the Finance and Accounting sector, where only 8& of businesses had policies protecting them against cyber attacks.

 

29% vs. 56%

Although 78% of UK businesses have a variety of insurances in place to protect their business, the gap between small and larger businesses has widened this quarter.

29% of SMEs with a turnover of less than £1million have employee injury cover, in comparison to 56% of businesses who have more than £10m in turnover.

24% of SMEs have property damage cover, in contrast to 48% of larger companies, while only 11% of SMEs have cover for health and safety risks, compared to 35% of bigger businesses.

 

39%

When looking at the top SME business priorities, 39% of SMEs are covered for being sued for negligence, an increase of 4% on Q2 2015 (35%).

Further highlighting that SMEs are becoming more insurance aware, 33% have insurance policies covering them against damage to property, including problems such as natural disasters and arson, an increase of 5% on the 28% in Q2 2015.

 

Commenting on Aon’s survey of 1,042 decision makers from the SME sector, Chris Lee-Smith, MD, Aon Affinity, said: "Cybercrime is a significant risk and security concerns should be top of mind for any business.

"Our research suggests that whilst general economic confidence in the SME sector is improving, many are over-looking the need to protect their business from very real risks that could derail growth plans."

 

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