The United States Government Accountability Office (GAO) recently conducted a study on the cyber insurance market to identify key trends, challenges, and mitigations for those challenges. They analyzed industry data, reviewed cyber risk reports, interviewed officials and cyber insurance providers, and presented their findings for all to view. Here is BW Cyber Services’ take.
GAO identified 4 key trends in the current cyber insurance market:
- An increase in take-up: the number of clients electing cyber insurance coverage rose from 26% to 47% in 4 years.
- An increase in price: as more clients opt for cyber insurance, the price of insurance has risen by up to 30%. Clients who face more frequent or more severe cyberattacks have also seen a significant increase in price.
- Lower coverage limits: given that cyber-attacks have become so popular, insurers have reduced coverage limits for certain industry sectors (most notably healthcare and education).
- The creation of cyber-specific policies: instead of including cyber risk in other insurance policies, many insurers now offer a policy specifically for cyber risk. GAO noted this may be due to clients demanding higher coverage limits and more information on what exactly is covered in the policy.
GAO also identified 2 key challenges facing the cyber insurance industry:
- Limited historical data on losses: there is a distinct lack of complete, accurate data regarding losses due to cyber incidents, making it difficult to estimate the potential losses from future cyber incidents.
- A lack of consensus on definitions across various cyber policies. For example, one insurance carrier may define “cyberterrorism” differently than another carrier, making it difficult for clients to discern what cyberterrorism coverage actually entails.
How BW Cyber Services Can Help
BW Cyber Services is not a cyber insurer, but we do understand the intricacies of cybersecurity insurance. Due to the massive spike in cyber-related attacks in recent years, we strongly recommend that our clients obtain a cyber policy. We are here to assist with policy selection, establishing partnerships between our clients and cyber insurers, and providing unique insights on the cyber insurance process overall. For more info on this or our other services, please contact BW Cyber Services at firstname.lastname@example.org.