Cyber insurance premiums have skyrocketed over the past year as high-profile incidents have continually kept cyber risks front and center, according to new research.
Spending on standalone cyberinsurance coverage rose 92% to more than $3.1 billion for the year in the United States, according to statistics gathered by analysts at Fitch Ratings.
The research found that cyber insurance prices have grown at a significantly higher rate than other commercial lines of business and that cyber insurance is now the fastest growing segment for property and casualty insurers Americans.
Why the price spike?
Fitch attributed the rise in insurance premiums to an increase in the number of cyberattacks.
Data from Fitch revealed that the number of cyber insurance claims increased by 100% over the past three years and 8,100 claims were paid in total in 2021, a 200% increase year over year. other.
Meanwhile, direct written premium spending on cyber insurance grew 74% in 2021, to nearly $5 billion according to statistics.
However, the rapidly growing market is still under the control of a select few players.
The top ten underwriters of cyber insurance controlled 57% of the market share in the United States in 2021, up from 67% the previous year.
Chubb Limited held 10% of the market share, while Fairfax Financial Holdings Limited (FFH) and AXA XL held 10% and 9% respectively.
It’s no surprise that cyber insurance premiums are on the rise, with 2021 cyberattacks such as the Colonial Pipeline incident showing the potential for cyberattacks to cause large-scale havoc beyond the confines of their target business.
According to a report by cybersecurity firm Sophos, two-thirds (66%) of midsize businesses globally suffered a ransomware attack last year, up from 37% the previous year.
Insurers themselves are not immune to the threat.
AON, a British-American multinational selling financial risk mitigation solutions, revealed that it had been the victim of a ransomware attack.