A significant number of small and medium enterprises (SMEs) in Singapore are still hesitant to purchase cyber insurance, despite increased awareness of cyber risks, according to QBE Insurance’s latest Singapore SME Survey.
The survey, conducted between December 2024 and January 2025, revealed that 68% of SMEs have refrained from purchasing cyber insurance, even though they are increasingly aware of the potential threats. In fact, the understanding of cyber risks among businesses has declined, with only 40% of SMEs considering themselves fully informed, a decrease from 47% last year.
Despite the rise in cyber incidents, which have increased slightly from 25% to 27%, the adoption of cyber insurance has actually fallen from 38% to 36%. Among those SMEs without coverage, 51% expressed interest in purchasing a policy, while 15% dismissed the idea entirely. Those rejecting cyber insurance cited reasons such as high costs, insufficient data storage capabilities, and the perceived low impact of cyber threats.
Shun Quan Goh, QBE Singapore’s Head of Underwriting for Retail & SME, acknowledged the reluctance but stressed the growing importance of risk management tools like cyber insurance. Goh highlighted that as businesses become more reliant on technology, safeguarding against cyber risks has become crucial, even as SMEs prioritize controlling costs.
The survey also noted shifts in the preferred methods of purchasing insurance. While offline channels remain the dominant choice, the use of agents has risen to 29%, while the use of brokers and banks has decreased. Additionally, the popularity of online-direct insurance purchases has grown to 22%, and the use of aggregators has dropped to 13%.
When it comes to insurance packages, 73% of SMEs prefer tailored solutions that cover multiple business risks, rather than opting for individual policies.
QBE Singapore CEO Ronak Shah emphasized that businesses continue to value a hybrid approach, combining digital access with human interaction. As artificial intelligence continues to reshape industries, Shah urged SMEs to focus on upskilling their employees to adapt, rather than relying on job displacement.
The survey gathered responses from 600 decision-makers across various industries, focusing on key business risks, including the adoption of AI and the digitalization of insurance processes.
Related topics
