A cyber insurance solution for African businesses

The rate of cyberattacks on businesses around the world is increasing at a pace never seen before, fuelled by sophisticated technology, including the use of artificial intelligence to launch more vicious attacks and bypass cyber security systems.

Latest tech leads to more damaging attacks

The most common form of cybercrime facing both businesses and individuals is phishing, notes London-based IT services provider, AAG. In 2021, 323 972 internet users reported falling victim to phishing attacks, meaning that half of the users who suffered a data breach did so through a phishing attack.

AAG also says that ransomware remains a growing organisational threat, with more advanced methods of attack forcing payouts from victims. Phishing is the most common entry point for ransomware attacks.

World-renowned futurist, Bernard Marr, predicts that social engineering attacks where users are tricked into giving attackers access to systems will increase in sophistication. He says generative AI such as ChatGPT tools will enable attackers to make smarter, more personalised approaches, and deepfake attacks (using artificial photos and videos) will become increasingly prevalent.

When companies are hacked, the costs of rectifying the breach and recovering from downtime spirals into millions. AAG estimates that the average cost of a cyber breach for large firms is around $4.35 million.

Towards the end of last year, Forbes reported that the cost of cyberattacks on the global economy would top $10.5 trillion in 2024. It said 'this staggering amount reflects the growing need for cyber security to be treated as a strategic priority on an individual, organisational and governmental level'.

Growth in cyber insurance

This mounting threat has naturally spurred the need for increased insurance. According to Statista, the global cyber insurance market will grow significantly over the next five years.

It estimates that the total market size will increase to US$20 billion by 2025 from a base of US$8 billion in 2020. The majority of this growth will come from increased demand from the corporate sector, where cyber incidents have the potential to damage both the bottom line as well as the reputation of a company.

Cyber threats are consistently deemed to be one of the leading risks to businesses worldwide, with cyber insurance providing network security coverage and financial security against the damage caused in a cyber incident and remediation efforts.

Africa in the firing line

Nowhere is cyber insurance more desperately needed than in Africa.

The uptake of cyber security measures across the continent has not maintained pace with its rapidly evolving digital environment, leaving businesses vulnerable to cyberattacks.

Positive Technologies (PT), a major global provider of information security solutions, believes that the 'lack of proper measures for ensuring cybersecurity, an insufficient legislative framework in the field of information security, and a low level of awareness about cybersecurity issues among the general population are leading to an increase in the number of cyberthreats'.

In fact, this low level of preparedness costs affected countries on average 10% of their GDP, it says. Financial organisations (18%) are the primary target of cybercriminals, followed by telecommunication companies (13%), which are attractive targets for data theft and extortion.

PT maintains that a lack of effective international cooperation and information exchange between African countries is hindering the fight against cybercrime, making it even more important for businesses to ensure they have their own adequate cybersecurity and cyber insurance policies in place.

An effective cyber insurance solution for Africa

To address this constantly, and quickly, evolving business risk, Reinsurance Solutions Zambia Limited has teamed up with cyber underwriters to provide a robust cyber insurance solution for African businesses, underwritten by specialised cyber reinsurers.

The new solution comprises a comprehensive insurance policy that covers a wide range of cyber-related incidents as well as necessary support to businesses in the face of cyber threats. The policy can be customised to address clients' unique risks and requirements, based on the nature of their businesses and operating environments.

As an African business you can now safeguard your operations, protect your assets, and mitigate the financial and reputational risks associated with cyber incidents, with a cyber insurance solution created just for you.

Contact your Reinsurance Solutions broker for further information.