A new survey of senior private equity professionals reveals only 23% describe the due diligence that private equity firms carry out on cyber security issues of target companies as ‘good’ or ‘excellent’. The research, which was commissioned by Mactavish, the leading expert on commercial insurance placement and disputes, reveals that 30% of the private equity professionals interviewed describe the industry’s work here as ‘average’, and 27% them said it was ‘poor’ or ‘terrible.’
However, the findings suggest future potential improvements in this area, as 83% of respondents expect private equity firms to insist that its portfolio companies all have specific cyber insurance policies in place within the next three years.
When it comes to private equity firms buying cyber insurance for their own operations, 53% of industry professionals interviewed said they believe the industry is focusing more on this issue. When asked what they think are the main obstacles to private equity firms securing appropriate cyber insurance, 27% said cover is too expensive when compared to the risks they face in this area. The same proportion of respondents say they feel the cyber risk exposure the private equity sector faces is not serious enough to require insurance. 13% of those interviewed said it’s because it’s difficult to find the desired cover.