Cyber Insurance - Thematic Intelligence
Summary
Cyber insurance provides cover against first- and third-party financial losses arising from damage to, or loss of data from, IT systems. GlobalData estimates the global cyber insurance market size to be $16.7 billion in gross written premiums (GWP) in 2022. Significant growth in 2020 and 2021 was largely due to substantially raised premiums. After the pre-pandemic years – characterized by high coverage limits, flat rates, and abundant capacity – the cyber market has hardened considerably. The frequency and severity of cyberattacks, coupled with economy-wide shifts to remote working, caused insurers to raise prices at these rapid rates. We forecast the global cyber insurance market to be worth $33.4 billion in GWP in 2027, recording a compound annual growth rate of 14.9% over 2022–27.
Cyber risks are growing for SMEs of all sizes. According to GlobalData’s 2022 UK SME Insurance Survey, almost 50% of medium-sized firms said that their cyber risk has, to some extent, grown since the onset of COVID-19. While the pandemic has raised the cyber risks most businesses face, it has also increased the likelihood that many SMEs will purchase cyber insurance. Indeed, over a quarter of UK SMEs indicated that they purchased cyber as a result of increased remote working due to the pandemic. While many businesses clearly understand the risks and need for cyber insurance, others still lag behind. These are the customers that brokers and other intermediaries should target to grow the line further. The tough economic climate may hold some businesses back from making the purchase right now. But as economies return to growth, the cyber line looks set to receive strong demand going forward.
Scope
- According to the National Association of Insurance Commissioners (NAIC), Chubb was the largest cyber insurer in the US in 2021, reporting $473.1 million in direct written premiums and a 9.8% market share.
- Over a quarter of UK SMEs indicated that they purchased cyber as a result of increased remote working due to the pandemic.
- The personal cyber insurance market is considerably smaller than the commercial one, but the product is slowly becoming more popular. In GlobalData’s 2022 UK Insurance Consumer Survey, 5.9% of respondents indicated that they owned a personal cyber insurance policy.
- Determine market size and key growth opportunities in the global cyber insurance landscape.
- Benchmark yourself against the leaders in the market.
- Ensure you remain competitive as new innovations and insurance models begin to enter the market.
- Be prepared for how regulation will impact the cyber insurance market over the next few years.
- Executive Summary
- Players
- Thematic Briefing
- The cyber risks faced by businesses are wide-ranging
- The cybersecurity and cyberattack landscape
- Large businesses and critical industries are most likely to be targeted for cyberattacks
- Poor employee practice and awareness are the primary reasons for cyber breaches
- Ransomware costs are significant, but more companies are refusing to pay
- Data is a valuable commodity to business, but the cost of a breach is enormous
- Trends
- Technology trends
- Macroeconomic trends
- Regulatory trends
- Industry Analysis
- Market size and growth forecasts
- Chubb, Fairfax, and AXA are among the leading cyber insurers in the world
- The UK cyber insurance market dynamics
- Uptake by SMEs has been variable over time and depends on business size
- The pandemic caused policy cancellations, but cyber risks have steadily increased
- Remote working, media reports, and intermediary advice are key purchase triggers
- Many SMEs forego cyber cover as they underestimate the risks their business faces
- Personal cyber insurance will grow as younger consumers come into enough wealth
- Timeline
- Signals
- M&A trends
- Venture financing trends
- Company filing trends
- Value Chain
- Product development
- Marketing and distribution
- Underwriting and risk profiling
- Claims management
- Customer service
- Companies
- Public companies
- Private companies
- Sector Scorecards
- Non-life insurance sector scorecard
- Who’s who
- Thematic screen
- Valuation screen
- Risk screen
- Glossary
- Further Reading
- GlobalData reports
- Our Thematic Research Methodology
- About GlobalData
- Contact Us
- List of Tables
- Table 1: Four main types of threat actors – thieves, hacktivists, terrorists, and other malicious players.
- Table 2: Percentage of UK businesses reporting a cyberattack, by business size, 2018–2022
- Table 3: Technology trends
- Table 4: Macroeconomic trends
- Table 5: Regulatory trends
- Table 6: M&A trends
- Table 7: Venture financing trends
- Table 8: Public companies
- Table 9: Private companies
- Table 10: Glossary
- Table 11: GlobalData reports
- List of Figures
- Figure 1: Who are the leading players in the cyber insurance theme and where do they sit in the value chain?
- Figure 2: TMT, financial services, and energy are three of the most targeted sectors by cybercriminals
- Figure 3: Phishing emails are comfortably the most frequently cited reason for cybersecurity emails
- Figure 4: Ransomware remediation costs in 2022 were highest in Belgium in 2022
- Figure 5: The digital unit scale
- Figure 6: The average cost of a data breach in the healthcare industry exceeds $10 million
- Figure 7: We estimate that the global cyber insurance market was worth $16.7 billion in 2022
- Figure 8: Chubb is the largest cyber insurer in the US, with a 9.8% market share and DWP of $473.1 million
- Figure 9: AXA is the most popular8 cyber insurance provider in the UK
- Figure 10: Over 50% of UK medium enterprises have cyber cover in place
- Figure 11: Just over 2% of companies have canceled their cyber policies due to COVID-19
- Figure 12: Over a third of UK SMEs canceled their cyber insurance policy as a cost-saving measure
- Figure 13: Many SMEs are acutely aware of the heightened cyber risk they face in the post-pandemic world
- Figure 14: Remote working and media reports are key triggers for the purchase of cyber insurance for SMEs
- Figure 15: 56.9% of cyber policyholders renewed their policy for higher premiums in 2022
- Figure 16: Many companies do not believe they will be targeted by cyberattacks
- Figure 17: COVID-19 has raised the possibility of some SMEs purchasing cyber insurance
- Figure 18: There is strong interest among younger generations to purchase a personal cyber insurance product
- Figure 19: Over 60% of consumers would want financial reimbursement as a feature of a personal cyber policy
- Figure 20: The cyber insurance story
- Figure 21: The number of cyber insurance mentions in insurance company filings has been increasing year-on-year
- Figure 22: The insurance value chain
- Figure 23: The cyber insurance value chain – product development
- Figure 24: The cyber insurance value chain – marketing and distribution
- Figure 25: The cyber insurance value chain – underwriting and risk profiling
- Figure 26: Who does what in the non-life insurance space?
- Figure 27: Thematic screen
- Figure 28: Valuation screen
- Figure 29: Risk screen
- Figure 30: Our five-step approach for generating a sector scorecard
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