The UK’s cyber-insurance market has witnessed a dramatic surge, with total payouts reaching £197 million (approx ₹2,080 crore) in 2024 — up from £59 million (approx ₹620 crore) the previous year. This marks a staggering 230% increase, driven primarily by a sharp escalation in ransomware and malware attacks that now make up more than half of all cyber-insurance claims.
A Shift in the Threat Landscape
Recent industry data reveals that ransomware-related claims rose from 32% in 2023 to 51% in 2024. The rise indicates not just the growing sophistication of cybercriminals but also a higher dependency among companies on insurance as a financial shield against operational paralysis. Many victims reportedly chose to pay ransom demands rather than risk prolonged system downtime and data loss, further inflating claim volumes.
Insurance: Shield or Catalyst?
While insurers argue that cyber-insurance improves overall security by mandating strict risk-assessment and compliance protocols, some experts warn it could inadvertently embolden attackers. The assurance of quick claim settlements may encourage organisations to comply with ransom demands — effectively fuelling the criminal ecosystem that these policies aim to counter.
Global Lessons and Indian Relevance
For Indian businesses, law firms, and startups handling cross-border data, the UK’s experience serves as a cautionary signal. As ransomware becomes more targeted and global in scale, reliance on insurance alone is insufficient. Firms must invest in robust incident-response planning, vendor-risk vetting, and continuous network monitoring.
With cyber-fraud and data-theft incidents rising domestically, India’s insurance and regulatory frameworks will need to evolve — bridging the gap between financial recovery and real-time prevention.
