Cyber Attacks Surge, Insurers Pay Out £197M in 2024

According to new data, UK insurers paid out at least £197 million in cyber claims in 2024, more than triple the £60 million paid the previous year. This sharp rise in claims reflects a growing threat from cyber gangs targeting British businesses.

The Association of British Insurers reported that companies saw a significant increase in claims on their cyber insurance policies, a small but rapidly expanding market. Malware and ransomware attacks accounted for 51% of the total claims, up from 32% the prior year.

The surge in claims occurred before a series of high-profile attacks earlier this year on major retailers like Harrods and Marks and Spencer, as well as manufacturer Jaguar Land Rover, which was not covered by cyber insurance. Industry experts warn that many businesses are still underinsured against these growing cyber threats.

Hackers have increasingly targeted large and prominent companies, infrastructure, energy, and transportation systems in order to disrupt the economy more broadly. They have also leveraged artificial intelligence to design more sophisticated phishing campaigns. Geopolitical tensions have contributed to the rise in attacks in recent years.

While the government has found that 45% of UK businesses have some form of cyber insurance, many policies have significant gaps or exclusions. Regulators and industry leaders argue that recent incidents highlight the need for businesses to purchase more comprehensive cyber coverage to protect against the growing threat.