Cyber insurance remains underpenetrated among UK SMEs

A GlobalData survey has recovered that a cyber extortion spread persists crossed UK SME segments, driven by rising menace vulnerability and the under-penetration of cyber insurance. As SMEs deepen their reliance connected integer systems and cybercrime becomes much sophisticated, galore firms stay uninsured oregon underinsured comparative to their exposure.

GlobalData’s 2025 UK SME Insurance Survey recovered that cyber security penetration rises sharply successful enactment with steadfast size: 13.1% of sole traders study holding cyber insurance, compared with 26.4% of micro firms, 40.1% of tiny firms, and 63% of medium-sized firms. This indicates that the smallest companies—which often person the weakest cyber controls and slightest capableness to sorb losses—remain the slightest protected. Persistent adoption barriers see perceived affordability issues, uncertainty astir what cyber policies cover, and constricted entree to wide proposal astatine the constituent of sale.

Research from Grant Thornton reinforces the standard of non-coverage, uncovering that 35% of UK SMEs person nary cyber security successful place. Meanwhile, according to the UK Department for Science, Innovation and Technology, 42% of tiny businesses experienced a breach oregon onslaught successful 2025, highlighting a widening mismatch betwixt incident

frequency and protection. Experts reason that positioning cyber arsenic a specializer add-on alternatively than modular commercialized extortion increases the likelihood of SMEs discovering sum gaps lone aft an incident. For insurers, this under-penetration represents some a maturation and retention opportunity. Closing the spread volition necessitate improving organisation effectiveness (including broker acquisition and income tools), reducing underwriting friction for smaller firms, and reframing cyber arsenic a applicable resilience merchandise combining security with incidental effect and preventative services. Providers that marque cyber screen easier to buy, easier to understand, and intelligibly applicable to SME operational continuity are champion placed to summation connect rates and trim persistent underinsurance.

"Cyber security remains underpenetrated among UK SMEs" was primitively created and published by Life Insurance International, a GlobalData owned brand.

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