UK Businesses Lost $55 Billion Over 5 Years To Cyberattacks: Howden

Cyberattacks are on the rise across the globe and businesses are facing mounting pressure to secure their networks and fortify their databases.

Yet, an alarming number of businesses aren’t heeding the warnings, as noted by international insurance intermediary group, Howden.

According to a news release published on its website, Howden revealed a study that finds over half of private sector businesses in the UK have faced and suffered from at least one cyberattack over the past five years.

The study consisted of a survey of 905 senior IT decision-makers conducted from September 9 to 22, 2024.

As such, these incidents have resulted in a loss of around £44 billion or $55 billion in revenue.

This number (74%) was higher with businesses that had an annual revenue of £100 million or $125 million. Yet, bad actors weren’t influenced just by higher-earning companies, with 49% of SMEs with revenues between £2 million ($2.5 million) and £50 million ($62.8 million) also facing the brunt of cyberattacks over the same period.

According to the study, the most common causes included:
 

• Email compromise at 20%

• Data theft at 18%

• Supplier compromise at 16%

• Fraudulent fund transfers at 14%

• Malicious insiders at 14%

• Ransomware at 12%

• Others at 6%

However, this didn’t represent the average cost of attacks. Here the order was:
 

• Supplier compromise cost £3.4 million / $4.28 million

• Malicious insiders cost £2.9 million / $ 3.65 million

• Fraudulent fund transfers cost £2.7 million / $3.4 million

• Email compromise cost £2.1 million / $2.6 million

• Data theft cost £2 million / $2.51 million

• Ransomware cost £1.7 million / $2.14

One of the biggest concerns observed was that the adoption of even the most basic cybersecurity measures was low, with 61% of businesses actively using antivirus software and 55% utilizing network firewalls.

Howden notes that by implementing cybersecurity basics, businesses in the UK could reduce cyberattack costs by (estimated) up to around 75%, which accounts for around £30 billion ($37.7 billion) from 2019-24, saving them around £3.5 million ($4.4 million) over ten years, with an ROI of 25%.

On the other hand, for businesses, challenges such as cost (26%), insufficient knowledge (26%), and lack of internal IT resources (22%) are creating roadblocks in improving cybersecurity. Furthermore, 33% feel a tax relief on cyber investment will encourage improvement, while free access to cyber expertise and resources (32%), compulsory minimum cyber standards (31%), and compulsory cyber insurance (26%) can form other contributing factors.

“Cybercrime is on the rise, with malicious actors continuing to take advantage of cybersecurity vulnerabilities, particularly as firms become ever reliant on technology for their operations,” said Sarah Neild, the Head of UK Cyber Retail at Howden.

“UK businesses are currently losing a significant amount of revenue to cyberattacks, and the insurance industry is crucial to strengthening resilience and raising awareness of the security measures needed to help businesses protect their operations.”

“Engagement with SMEs will be particularly important. This segment has been historically underserved by the cyber insurance market yet forms an important backbone of economic activity, both in terms of its size but also as an engine of growth.”

“Through increased insurance penetration and education about implementation, we can help businesses improve their cyber resilience and protect against loss of revenue from these attacks.”

Do you think governments around the world should consider offering businesses tax exemptions to encourage better cybersecurity practices?

Let us know in the comments below!