As the cyber threat landscape becomes more complex, attitudes toward preparedness against cyber risks is declining. In 2024, 73% of U.S. business leaders feel resilient against cyber risk, a significant long-term decline from 86% in 2022, according to Beazley's latest Risk & Resilience report, “Spotlight on Cyber & Technology Risk 2024."

Further, 2 in 3 (65%) of U.S. respondents believe that their existing cyber defenses are currently sufficient to deal with a cyberattack and just 23% of U.S. executives rank cyber risk as their top risk this year, down from 34% in 2021—pointing to a potential blind spot despite the growing risk landscape.

“As our report shows, with technological innovation set to bring about seismic societal change, the growing regulatory burden for firms, and cyber criminals becoming more and more sophisticated, businesses are facing a wave of new threats," said Paul Bantick, global head of cyber risks at Beazley. “The need for robust risk mitigation strategies has never been greater, and insurance can play an important role."

Twenty-seven percent of U.S. businesses do plan to invest in cybersecurity measures this year. Another 23% said they intend to explore insurance options that include risk and crisis management services.

“The increasing sophistication of threat actors has blurred the line between nation-state and criminal cyber activities," said Francisco Donoso, chief technology officer of Beazley Security. “This convergence has brought about a new era of unprecedented risks that leave global business leaders feeling unprepared."

“While investments in protection and defense are essential, security professionals must recognize that security edge devices are increasingly targeted as an entry point in an attack," Donoso said. “They should enhance detection capabilities while also focusing on building cyber resilience to ensure readiness to respond to threats as they emerge."

Artificial intelligence (AI) is a key catalyst in the increasingly sophisticated cyber risk landscape. It is helping cybercriminals refine existing attack techniques while also creating new attacks such as deepfakes. As hackers become harder to identify, businesses must have effective defenses to counter AI-powered cyber risks, the report warned.

However, AI is also providing organizations with opportunities to protect against those same attacks. Twenty-six percent of surveyed U.S. businesses are planning to invest in AI and other new technologies to improve their resilience.

AI is also set to have a significant impact on businesses as a whole, with 59% of U.S. business leaders agreeing that AI will replace jobs in their companies. Additionally, many business leaders are concerned about the speed of AI innovation, with 27% citing tech obsolescence risk as their biggest threat this year. One in 4 admitted they were unprepared to manage this risk.

AnneMarie McPherson Spears is IA news editor.