Cyber Insurance Boosts Ransomware Data Recovery Rates: Study

According to a new report by Sophos, titled “The Critical Role of Frontline Cyber Defenses in Insurance Adoption.” The report details how an organization’s cyber defenses impact their insurability, premium costs, and policy terms, highlighting that the quality of an organization’s cyber defenses is crucial. The report found that 95% of organizations that purchased a cyber insurance policy in the last year reported a direct impact. Specifically, 60% said it impacted their ability to get coverage, 62% said it impacted the cost of their coverage, and 28% said it impacted the terms of their policy.

 

The research also revealed that cyber insurance adoption is now the norm, with 91% of organizations reporting having coverage. An additional 8% of organizations reported that they don’t currently have coverage but plan to obtain it in the next year. Insurance coverage plays a role in an organization’s ability to recover from an attack.

 

Organizations with cyber insurance are more likely to be able to recover data that was encrypted in a ransomware incident. Specifically, 98% of those with a standalone policy and 97% of those with cyber as part of a wider insurance policy were able to recover encrypted data after a ransomware attack, compared to 84% of those without cyber coverage.

 

Moreover, organizations with standalone cyber insurance policies are almost four times more likely to pay the ransom to recover encrypted data than those without cyber coverage. Of those that had data encrypted in a ransomware incident in the last year, 59% of those with a standalone cyber insurance policy paid the ransom, compared with 37% of those with cyber as part of a broader insurance policy and 15% of those that don’t have cyber insurance.