Cyber threats are no longer just an IT issue, the government has warned, as it urges businesses to insure themselves against the financial consequences of hacking.
Cabinet Office minister Francis Maude is meeting with business leaders today to warn them they aren't as prepared as they think for cyber attacks, citing the importance of insurance to counteract the financial cost of data breaches.
He said: "It is part of this government's long-term economic plan to make the UK one of the safest places in the world to do business online.
"Insurance is not a substitute for good cyber security but is an important addition to a company's overall risk management.
"The market has extensive knowledge and experience of more established risks to help businesses manage and mitigate relatively new cyber risks."
He cited a 2014 Information Security Breaches Survey that suggested that while 52 per cent of CEOs think they have insurance cover for cyber attacks, less than 10 per cent actually do.
Meanwhile, a UK Cyber Security report published today argues that firms should review their cyber risk management, even considering establishing a chief risk officer and introducing stress tests to ensure their defences are robust.
Mark Weil, CEO of cyber insurer Marsh, said: "Companies will need to upgrade their risk management substantially to cope with the growing threat of cyber attack, including introducing disciplines such as stress-testing, and creating a joined-up recovery plan that brings together financial, operational, and reputational responses."
The government, Lloyd's of London underwriters and the Association of Business Insurers also committed to developing a cyber insurance guide they will host on their respective websites.
This would build on the government's Cyber Essentials scheme to educate businesses about how to protect themselves against threats.
The news comes after another government study of 1,000 SMBs found just 16 per cent consider cyber security a priority, while 24 per cent said protective measures are too expensive.
In answer to that, Marsh has introduced SMB cover that pays for the cost of Cyber Essentials certification for most firms.
Is your business prepared for new EU cyber security regulations? This whitepaper offers advice, insight and guidance on what to do next. Read it today here.
