Global gross premium for cyber insurance has been estimated globally at around some $9 billion if captive insurers are also included, according to analysis by Insuramore, with the US market alone likely to make up over a half of the total.

The study also showed that the top 20 groups for this class are likely to have accounted for almost 77% of premiums worldwide and the top 100 groups for over 98%.

Beazley and Chubb are likely to have been the global market leaders by gross written premium, followed by Munich Re, Fairfax Financial Holdings and Axa.

Insuramore said that the relatively new and specialized nature of cyber cover plus its geographic skew to the US make it a more concentrated sector than most other categories of insurance:

“For instance, the equivalent percentages (in 2020) for the top 20 and top 100 groups in total commercial P&C insurance worldwide were 40% and 70%, respectively, while for auto (motor) insurance they were a respective 47% and 71%. However, due to high rates of ceded reinsurance and, to a lesser extent, securitization of cyber risks, the apparent concentration of GWP is, of course, only a partial indicator of where insured cyber risks ultimately lie.”

Overall, the research established that over 180 insurer groups were underwriting cyber risks on a direct basis by the end of 2021 including over a half of the world’s top 250 groups by total P&C (non-life) GWP.

Several significant insurer groups that were not underwriting cyber risks themselves were found to act as distribution partners for it.

During 2022, and over and above pure demand for additional capacity in this risk category, the number of insurer groups underwriting cyber cover is likely to increase for several reasons:

– demand for and penetration of cyber insurance may grow in countries in which it remains relatively under-developed, such as in the Asia-Pacific region, thereby attracting local market entrants;

– there is potential for cyber cover to be marketed more actively to private customers, perhaps on an embedded basis within home insurance or cyber security software, or as an enhancement to high-end credit cards or bank accounts, or even as an employee benefit;

– several MGAs with a focus on cyber insurance (eg Coalition, Cowbell Cyber, Resilience) have been setting up their own carriers with a view to potentially retaining a proportion of risk themselves, joining a few other MGAs (eg CFC Group) that have already taken this step.

On the other hand, Insuramore said that trying to precisely forecast the growth of the global cyber insurance market beyond the next year or two is problematic as the explosive growth witnessed in 2021 and the first half of 2022 is unlikely to be sustainable. Nevertheless, it said that it seems certain to remain on a strong upward trajectory.

Overall, the research established that over 180 insurer groups were underwriting cyber risks on a direct basis by the end of 2021 including over a half of the world’s top 250 groups by total P&C (non-life) GWP.

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