Kathmandu. Cyber insurance covers most corporate losses. Worldwide, cyber insurance has paid out nearly $1 billion. This translates to more than 95 per cent of average data breach losses and 90 per cent of direct corporate losses.
According to Willis’ analysis report ‘Cyber Claims in Focus-Getting Value from Cyber Insurance’, 5,500 cyber insurance claims were examined in 95 countries between 2013 and early 2026. During that time, it was found that cyberattacks were becoming more serious, but companies that bought insurance coverage were receiving the most claims. However, statistics show that there is a huge gap between what cybercriminals demand and what insurance actually covers.
These ransomware attacks will now cause the most serious financial damage due to long-term company downtime, the report said. The average ransom demand has reached $3.8 million. The actual average payment has dropped to $15 million. The average total cost of a ransomware incident is $53 million, taking into account productivity disruptions and business suspensions. The longest outage lasts for 25 days.
The largest single loss on record was more than $500 million, the report said. “It also provides a clearer picture of how hackers breach systems,” the report said, adding that direct attacks on the company’s own network accounted for 58 percent of ransomware reports but accounted for 95 percent of all financial costs. ’
In contrast, attacks by third-party vendors accounted for 42 percent. However, it accounted for only 5 per cent of the total losses.
Apart from ransomware, data breaches are the most common insurance claims, often due to malicious intent. Third-party vendors are responsible for nearly half of data breach losses and 29% of direct corporate losses.
When these external partners fail, IT, technology and telecommunications companies are responsible 50 percent of the time. This is followed by financial institutions (17 per cent) and administrative services (11 per cent).
In addition, the report highlights the issue of data-tracking devices (particularly pixel-tracking) as an emerging and underestimated risk. This can lead to huge insurance losses.
According to Peter Foster, president of Willis’ Global Phoenix Cyber, companies often pay for insurance coverage. “This does not match their real weaknesses,” he warned, putting them at risk of serious financial loss in the event of an attack. —Agency
