In its latest risk barometer, Allianz reports that cyber risks, such as computer failures, ransomware attacks or data breaches, rank as the most important risk globally (34% of responses).
gAlthough cybercrime is now estimated to cost the global economy more than $1,000,000,000 a year1, or approximately 1% of global GDP, it is perhaps unsurprising that cyber risk is the main concern of customers.
In addition to being voted the top risk globally, cyber incidents also rank as the top peril in 19 different countries. It is the risk that small businesses are most concerned about, which is the most feared cause of business interruption by enterprises, while cybersecurity resilience ranks as the environmental, social and governance (ESG) of most concern.
The frequency of ransomware attacks remains high, with losses increasing as criminals hone their tactics to extort more money, while the average cost of a data breach is at an all-time high. At the same time, the attacks are not just limited to large enterprises, we are seeing more and more small and medium-sized businesses affected.
said Scott Sayce, Global Head of Cyber at AGCS and Group Head of the Cyber Center of Competence.
According to respondents to the Allianz Risk Barometer, a data breach is the exposure of most concern to businesses (53%), given that privacy and data protection is one of the top cyber risks and that related legislation has tightened globally in recent years.
Such incidents can result in significant notification costs, fines and penalties, and also lead to litigation or compensation claims from affected customers, suppliers and data breach victims, notwithstanding any breach of reputation of the company concerned.
The average cost of a data breach hit an all-time high in 2022 of $4.35 million, according to IBM’s Annual Data Breach Report Cost, and is expected to exceed $5 million in 2023 , although these numbers are a small change from the costs. who may be involved in “mega breach” events.
An increase in data breaches is expected this year, predicts cybersecurity firm Norton Labs3, as criminals find ways to breach standard multi-factor authentication technologies.
An increase in ransomware attacks ranks as the second most important concern (50%). Around the world, the frequency of attacks remains high, as do the costs of related claims.
The cost of ransomware attacks has increased as criminals have targeted larger businesses, supply chains and critical infrastructure – in April 2022, an attack affected around 30 Costa Rican government institutions, crippling the territory during two months.
Double and triple extortion attacks are now the norm – in addition to system encryption, sensitive data is increasingly being stolen and used as leverage for extortion demands from business partners, suppliers or customers.
Skills shortages and capacity issues
With all these challenges, it’s no surprise that the demand for cybersecurity experts is growing. More and more companies are looking to employ cybersecurity specialists, but supply is not keeping up with demand.
According to Cybersecurity Ventures, the number of unfilled cybersecurity jobs worldwide has increased by 350% between 2013 and 2021 to reach 3.5 million6, enough to fill 50 major football stadiums.
At the same time, IT service providers and consulting firms that conduct forensic reviews of cyber incidents and restore systems lack capacity.
In Germany, the Federal Office for Information Security (BSI) has warned of a “fundamental shortage” of personnel for incident response services.
For those who are available to help, soaring inflation increases their cost. Ultimately, such conditions will affect the ability of some companies to make cybersecurity improvements or respond effectively to an incident.