Cyber insurance sector set to surge

The global cyber insurance market is expected to grow at a significant CAGR of some 19% to 2030, according to new research.

The report, by A2Z Market Research, suggests that the period 2023-30 will see a 19.4% CAGR for the sector.

According to the company, as technology advances, cybersecurity insurance is becoming more common in small, medium, and large-scale businesses. Furthermore, as commercial attacks became more prevalent in the media, more businesses sought cyber insurance. 

It added that cyber hazards are becoming more strictly regulated, with stricter underwriting and risk management requirements:

 “More cybersecurity rules are expected in the coming years. This is because an increasing number of regulatory organisations will call for more data on cybercrime to be collected and reported. Specific market data gathering requirements will be required for a reporting system that is simple to use and consistent across the board. This will lead to the implementation of adaptive cyber policies in many businesses in the coming years.”

The prediction comes as premium income in the cyber sector continues to demonstrate significant rises- albeit at a less steep gradient than previously. According to a recent report by Marsh on the US insurance market, cyber insurance pricing increases moderated to 28% in the fourth quarter, compared to 48% in the third quarter as new entrants to the market increased capacity.

The broker said that in some cases, increased competition and favourable cybersecurity controls actually resulted in flat renewals or reductions, while claim frequency declined and severity remained high.

Privacy claims increased, Marsh added, including those related to online tracking and other consumer protection issues. Systemic exposures, including those related to war, continued to be a concern, it suggested.