87% of startups are considering new cyber protection or tools for 2025. (Credit: Bartek/Adobe Stock)
Fully 93% of startups say they carry cyber insurance, up from 86% just two years ago, according to Embroker’s 2024 Cyber Risk Index: Startup Edition.
The increase could be due to growing fears about cyberattacks. Among startup founders, 81% have experienced a cyberattack in their career, up from just 67% in 2022. Most (61%) believe their company is somewhat or extremely likely to face a potential data breach, up from 51% in 2023.
Many funders, boards and clients are also looking for startups to carry cyber coverage. Most founders (41%) said the top way cyber coverage has helped them is by making it easier to secure funding.
“Cyber insurance is becoming more and more important not just from a protection standpoint,” said Andy Lea, Embroker’s chief insurance officer. “That’s not surprising given just how often cyber breaches make headlines.”
Founders also cited foreign relations tensions (31%), rising domestic ransomware attacks (27%) and hybrid workforce management (29%) as top reasons they’re investing in cyber insurance.
“The overall environment continues to be a driver for cyber purchases,” Lea said, citing national and global tensions. “That’s on top of people’s minds when they think about this coverage and what’s going on in the world.”
Nine in 10 startups have a dedicated cybersecurity team or vendor, and 87% are considering new cyber protection or tools for 2025. Most founders (48%) are opting to add cyber onto existing coverage rather than create custom packages.
While only 7% chose the most comprehensive cyber coverage in 2024 — down from 27% in 2023 — most founders said they felt confident about their protection level. Most (66%) believe their policies would fully cover their risk. In 2022, only 30% of founders said the same.
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