Demand for cyber insurance to grow after high-profile attacks

Demand for cyber insurance is set to grow amid a spate of high-profile attacks, according to a new market report from Bloomberg Intelligence (BI), titled “Cyberattacks Offer Growth Market for Insurers”. BI notes that pioneering cyber insurance provider Beazley (22.3 percent of H1 insurance contract written premiums) sees 18 percent compound annual growth for that cover in 2024 to 2030, while Hiscox, Axis Capital, Chubb and Munich Re also see rising demand. 

“An estimated $8 trillion was lost globally to cybercrime in 2023.”

Kevin Ryan, senior insurance analyst at BI, commented: “United Healthcare’s Change Healthcare medical billing processor, which links one third of Americans to health-insurance payments, suffered a cyber attack in February, crippling the payments systems of a significant number of hospitals. 

“The May attack on Ticketmaster compromising 560 million customer records is a further example of the unrelenting cybercrime challenge.

“An estimated $8 trillion was lost globally to cybercrime in 2023, according to technology consultant Cyber Security Ventures, a significant increase vs. the $600 billion McAfee estimated in 2018. 

“It’s clear the seriousness of attacks is increasing. As such, Allianz has said that cyber risk is the number one concern globally, along with business interruption.”

Insurers saw strong rises in cyber insurance premium rates in 2022, but these are now slowing, with Beazley’s 2023 cyber rates falling 5 percent following a 40 percent rise in 2022, notes BI. 

In mature markets, such as the US and Europe, cyber insurance may be one of the few areas of insurance to record real growth.

For more news from the American Property Casualty Insurance Association (APCIA) click here.

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