How brokers can be cyber defenders

The global financial impact of cybercrime is projected to reach $10.5tn annually by 2025. In the UK alone, there were 2,200 cyberattacks a day last year – or one every 39 seconds – according to research by Cybersecurity Ventures.

Cyber Clan says that in 2024 there has been a hike in aggressive ransomware attacks, malware tactics and cybercrime as a service. It is a threat which continues to evolve with sophisticated new methods of attack such as AI-driven phishing e-mails designed to break existing cybersecurity protocols.

Businesses in the fast-growing UK technology sector are particularly vulnerable due to a heavy reliance on data, algorithms, digital processes and use of cloud operating systems. Again, according to Cyber Clan, there has been a rise in attacks this year on cloud infrastructure, Internet of Things, 5G and emerging technologies as well as automotive and space technology.

Consequences of an attack

Tech firms fear that increasing attacks not only endanger operational security, but also impose significant liabilities concerning client data protection.

Nearly a decade ago ride-hailing firm Uber had to pay out around £113m to settle legal action for a cyber-breach exposing the data of nearly 60 million customers and drivers. A Meta Pixel breach in 2022 hit US healthcare providers, with the sensitive patient data of over a million people being exposed.

The impact therefore can be catastrophic not just on a financial level but also to business reputation and customer trust. From a financial perspective it can mean an inability to continue operating, failing to complete work, having to pay a ransom to hackers and the cost of recovering lost information or data.

The reputational blow could see existing clients or customers taking their cash and time elsewhere and the loss of potential new business. Companies could also fall foul of professional services and standards and legislation.

Benefits of broker relationships

Brokers can play a huge role in helping provide tech owners with the specialist guidance and assurance they need to improve both their prevention and response to cyberattacks.

Recent research from Markel found that brokers were keen to have more educated conversations with their technology customers about cyber risk and insurance. In turn, tech owners said they value the expertise brokers provide, such as being able to quickly assess how changing cyber market dynamics or a company’s own growth can impact levels of risk and required coverage.

An example of this coverage is Markel’s NMUK product, which has a 24/7 cyber incident response service offering prompt phone access to a team of specialists, public relations crisis management, as well as system and data rectification costs. In the event that a company experiences a cyber breach it will provide up to £10,000 for the cyber incident response team to immediately support in the risk mitigation.

Being able to offer levels of service such as this can be a differentiator for both clients when choosing policies and of course for a broker’s business. By helping to ensure that interruptions to and attacks on vital IT systems can be tackled efficiently and effectively they can retain and gain clients.