Almost all (99%) UK companies now backup their critical IT systems and data and 92% consider disaster recovery as an important drive in their IT expenditure, according to the 2008 Information Security Breaches Survey.

The number of companies with a disaster recovery plan in place now stands at 72%, up from 58% in 2006. This figure reaches 91% in large organisations.

But the research, which was carried out by a consortium led by PricewaterhouseCoopers on behalf of the Department for Business, Enterprise and Regulatory Reform (BERR), also discovered alarming holes in the disaster recovery habits of businesses.

More than a quarter (28%) of companies still do not have a disaster recovery plan in place, it found, of those that do half fail to regularly test them. A further 15% of companies fail to take their backups off-site, although the amount doing this rose from 76% two years ago to 85%.

Experience shows that plans are only effective if regularly tested. It is a concern that only half of plans have been tested in the last year

"It is encouraging to see that almost every UK business makes backups and the vast majority now take these backups off-site," Chris Potter, partner, PricewaterhouseCoopers LLP. "The risks are well understood; it does not take an incident to raise awareness.

"The number of companies with a disaster recovery plan has gone up," he added. "However, experience shows that plans are only effective if regularly tested. It is a concern that only half of plans have been tested in the last year."

The research also revealed that when companies suffered a systems failure or data corruption incident, 31% had no contingency plan in place and a further 10% found their contingency plan to be ineffective.

The south-west has now overtaken London as the region with the most disaster recovery plans in place - possibly as a result of last year's floods - but fewer of these plans are tested than in other regions, the survey discovered.