Why Indian companies increase use of insurance after cyber threats rise

Indian companies reported heavy financial losses tied to key insurable risks.

Indian companies are increasing their use of insurance and risk transfer tools as cyber threats, data privacy rules and property risks rise, Aon revealed.

Aon’s 2025 Global Risk Management Survey, which covered nearly 3,000 executives across 63 countries, found that cyber attacks and data breaches remain the top risk for Indian firms in 2025. 

Concerns over data privacy requirements and non-compliance have also increased, driven by tightening regulations in India and overseas. 

Property damage, exchange rate movements and business interruption were reported more frequently in India than in other Asian markets.

Indian companies reported heavy financial losses tied to key insurable risks. 

About 78% of respondents said they suffered losses from property damage, whilst 46% experienced losses from business interruption. Exchange rate fluctuations affected 64% of organisations. 

Cash flow pressures and talent-related issues also resulted in losses for almost half of respondents.

In response, more firms are formalising their insurance and risk management functions. 

Seventy percent now have dedicated risk and insurance departments, and nearly 65% measure their total cost of insurable risk, with many noting rising insurance expenses. 

Companies are also strengthening risk mitigation, with more than 90% conducting formal reviews and plans for cyber and property risks. 

Use of captive insurance is expanding, with 92% of respondents saying they are exploring or already using captives to improve financial resilience and support risk transfer.

Looking ahead, businesses expect cyber risk to stay at the top of the list through 2028, whilst AI-related threats are emerging as a major concern. 

Economic slowdown, business interruption and climate-related risks are also expected to influence insurance needs and pricing in the years ahead.