With insurance companies facing an average of 113 targeted breaches a year, it can be argued that cybersecurity is one risk the insurance industry is not prepared for. Prominent breaches, such as the Premera Blue Cross and Anthem attacks, saw a combined 90 million customer records fall into the hands of nefarious actors and the subsequent damage to both customers and carriers cannot be underestimated.
And yet, from this growing trend, opportunities are increasing; the sector is largely untapped, with experts projecting cyber insurance premiums to rise to more than $8bn by 2020, a substantial increase from $1.87bn in 2017. Premium growth will continue to rise over the next decade as the concept of cyber insurance becomes more entrenched across the sector. For comparison, Deloitte found that US P&C premium revenues rose only 4.6% in 2017 and this was the most such premiums had risen year on year in a decade. It is clear that for the right player with the right product, huge portions of the cyber insurance market are there to be won.
Adapting to customers’ cyber security needs is a clear opportunity for carriers to achieve rapid growth in a sector that is otherwise at capacity. However, carriers face many challenges before they can begin to maximize the potential in covering cyber risk. Insurance Nexus spoke to a panel of senior insurance executives and cyber risk experts to discover what the landscape looks like for carriers moving into cyber coverage.
- • Why underwriting for cyber risk poses challenges
- • The contribution made by catastrophe modeling
- • How to anticipate exposure to risk
- • The threat from quantum computing
- • The importance of customer education
This whitepaper was written in association with Insurance Nexus’ upcoming Cyber Insurance USA Summit 2019. The conference, which will welcome over 150 senior executives from across cyber, product, claims and business teams, will take place on November 4th and 5th, 2019, in Chicago, Illinois.