Surprisingly, most organizations have cyber assets that are worth 14 percent more than their plant property and equipment (PP&E), but not surprisingly, their rate of insurance is higher for their PP&E assets, according to the 2017 Cyber Risk Transfer Comparison Global Report. Organizations insure an average of 59 percent of their PP&E losses, compared to just 15 percent for cyber. This may seem a bit backward, especially when you consider that most companies spend more on property/fire insurance than they do on cyber related coverage, even though the chance of one of their buildings burning down or being impacted by a covered cause of loss is significantly less than one percent. Too many organizations are simultaneously aware of, but still largely ignoring, the real threat of cyber issues. Forty-six percent of companies questioned for the global report say they suffered a data breach in the last two years, with an average financial impact of $3.6 million, but they simultaneously admit that their cyber insurance is inadequate, too expensive or has too many exclusions.
I’m in no way suggesting reducing PP&E coverage —if it’s your building that does burn down, you’ll be glad you invested in the coverage. But I am sounding an alarm for every organization, large and small, to protect their technology and cyber assets.
Cyberattacks are on the rise. Digital criminals are gaining in sophistication. More and more of your operations are touched by technology. 90 percent of global cyber security and risk experts questioned for a study by American International Group believe that cyber risk is “systemic” and simultaneous attacks on multiple companies are likely in 2017. Those industries they identify as most-at-risk include financial services (19 percent), power/energy (15 percent), telecommunications/utilities (14 percent), healthcare (13 percent) and information technology (12 percent). If your industry isn’t on this list, don’t let it lull you into complacency.
The rate of change in technology is astounding. New risks arise every day. That’s why MJ is here to help you navigate the process of comprehensive protection. Please call us today for a review of your current cyber coverage and recommendations for change. We’re ready when you are!