In today's digital landscape, cyber security is more critical than ever, especially for recruitment agencies that handle sensitive client and candidate information. Recent initiatives from the UK Government aimed at enhancing cyber resilience underscore the importance of reassessing your cyber insurance coverage. Now is the perfect time to ensure your agency is adequately protected.
Understanding the risks
The cyber threat landscape is constantly evolving, and recruitment agencies face unique risks. Here are some key threats that should prompt you to review your cover:
- Ransomware attacks: Malicious software can cripple your operations, demanding hefty ransoms for the return of your data.
- Data breaches: The loss of sensitive candidate and client information can lead to significant financial and reputational harm, along with potential legal costs.
- System outages: Being locked out of your systems can halt your operations. This can lead to lost revenue and client trust.
- Phishing scams: Deceptive tactics can trick employees into revealing confidential information, exposing your agency to further risks.
Cost implications of a cyber incident
The financial impact of a cyber incident can be huge. When considering the average system outage you should think about how long it would take for your agency to lose revenue. Recovery can take days or even weeks, depending on the severity of the incident. For example, a recent incident involving M&S reportedly cost the company an average of £3.8 million a day in lost online sales. This highlights the urgent need for robust cyber insurance.
Many recruitment agencies still operate with inadequate cyber coverage, leaving them vulnerable to significant financial losses, including costs related to data destruction.
Current cyber risk insurance market conditions
Historically, cyber insurance has been viewed as unaffordable, leading many agencies to go without coverage. However, recent statistics indicate a shift in the market. Marsh’s latest Global Insurance Market Index shows an 8% reduction in cyber insurance premiums, with 78% of cyber clients benefiting from lower rates. This trend is part of a broader decline in global commercial insurance rates. As a result, cyber insurance policies are more accessible than ever.
What cyber insurance covers
The Recruiters Choice product includes free cyber coverage up to £250,000 when Professional Indemnity (PI) or Public Liability (PPL) insurance is purchased. However, it’s essential to highlight the limitations of this cover compared to a standalone cyber policy. Key exclusions include:
- Excludes data breach costs, including notification, forensic, and credit monitoring costs.
- Excludes losses from cyber-attacks, such as DoS attacks and damage from hackers (though cyber ransom losses are covered).
- Excludes breaches by suppliers and financial crime/fraud.
- Limited to £250,000 in aggregate indemnity.
- Coverage does not apply if you supply workers to the USA/Canada or derive turnover from those regions.
- A three-month business interruption indemnity period.
Many clients purchase additional cyber cover for data breach costs, crime/social engineering fraud or higher limits.
Traditional business insurance products often fall short in protecting against today’s cyber risks. Dedicated cyber liability insurance typically covers a range of incidents, including:
- Data breach response: Costs associated with notifying affected parties and managing public relations.
- Business interruption: Compensation for lost income during system outages.
- Legal fees: Coverage for legal expenses arising from cyber incidents.
- Forensic investigation: Costs for investigating security breaches and securing your systems.
Join our cyber state of the market webinar
Stay informed by joining the Marsh Cyber State of the Market webinar to hear about the latest insights and reflect on key developments in the cyber insurance market for Q2 2025. Topics include:
- Current cyber threats affecting UK organisations.
- Cyber claims trends and incident response scenarios.
- The role of cyber insurance in mitigating financial losses and enhancing resilience.
This webinar is ideal for corporate leaders, risk managers, and decision-makers looking to enhance their understanding of cyber risk management and insurance. Whether you are considering cyber insurance cover or seeking to deepen your knowledge, this session will provide valuable insights. Click here to register for the webinar.
Take action now
Now is the time to take action. Contact your REC Insurance Services adviser today to review your cyber insurance cover or click here to find out more. Protect your recruitment agency from the evolving cyber landscape and ensure you have the right safeguards in place. Your agency deserves the best protection. Let us help you achieve it.
The Recruitment and Employment Confederation (REC) is an Introducer Appointed Representative of Marsh Ltd. REC Insurance Services and Marsh Commercial are trading names of Marsh Ltd. Marsh Ltd is authorised and regulated by the Financial Conduct Authority for General Insurance Distribution and Credit Broking (Firm Reference No. 307511). Copyright © 2025 Marsh Ltd. Registered in England and Wales Number: 1507274, Registered office: 1 Tower Place West, Tower Place, London EC3R 5BU. All rights reserved.
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