Cyber insurance claims are declining as firms take ransomware recovery into their own hands

"We have long speculated about the negative effect of cyber insurance policies on ransomware. Organizations were incentivized to pay ransoms instead of refusing, leading to a vicious cycle of payments. The nascent cyber insurance market suddenly became unsustainable," said Databarracks managing director James Watts.

"But then things changed. As our Data Health Check found last year, cyber insurance prices increased significantly and the requirements to obtain cover became stricter. The result was that the bar of preparedness was raised. That change has had a fantastic impact on businesses' resilience."

"Insurers are increasingly asking organizations whether their backups are separate and air-gapped from production data, whether they’re encrypted, and whether their clients have a business continuity plan and have tested their recovery."

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