Insurers Respond Slowly to Growing Demand for Cyber Insurance: Timetric Report
Insurance Journal, October 2015
The cyber risk insurance market is experiencing rapid development, with the size of global gross written premiums growing from US$850 million in 2012 to an estimated US$2.5 billion in 2014, according to a new report by London-based business intelligence company, Timetric.
While the cyber risk insurance market is gaining traction due to a growing number of cyber attacks and the increasing reliance of businesses upon technology for operational capabilities and storing data, insurance firms are responding slowly to this rising demand, said the Timetric insight report, titled “The Future of Cyber Risk Insurance.”
“Total global losses from cyber crime stood at US$445 billion as of June 2014. With governments becoming increasingly involved in cyber threats, the prospect of compulsory cyber risk insurance could become a reality. It would have a transformative impact upon the market and could create a strong source of future revenues for non-life insurers,” commented Jay Patel, insurance analyst at Timetric.
European Demand to Grow Substantially
The demand for cyber insurance in Europe is expected to grow substantially, once the new General Data Protection (GDPR) law is finalized by the end of 2015. It is expected to come into force by 2017 in all the EU member states, making data breach notification compulsory. This will likely give more power to the regulators, along with an increase in penalties – up to EUR1 million (US$1.3 million), or 2 percent of company’s global annual turnover.
However, insurers have already experienced rapid growth in the demand for cyber-risk insurance over the last few years, the report said, noting that interest in cyber insurance has particularly grown among businesses that hold sensitive consumer information such as telecommunication companies, financial organizations and retailers.
The cyber insurance market in Europe is underpenetrated, with an estimated worth of US$150 million in gross written premiums in 2014, the report said.
In comparison, it added, the U.S. leads with approximately 90 percent of the global premiums in the cyber insurance market, which were valued at US$2 billion in gross written premiums in 2014.
“The reason why the European market is less developed than the U.S. is because of a small number cyber insurance products that are offered by insurers and less business awareness of the cyber risk problem. However, insurers are making forays to serve the European markets,” says Patel.
Insurance Journal Source: Timetric
Categories
- Benefits Resources
- Bonding
- BOP
- Business Insurance
- Commercial Auto
- Commercial Property
- Company News
- Construction
- Crime Insurance
- Cyber Insurance
- Directors & Officers
- Employee Benefits
- Employment Practice Liability Insurance
- Entertainment
- General Liability
- Health Insurance
- Healthcare
- Healthcare Reform
- Homeowners Insurance
- Hospitality
- Manufacturing
- Medical Malpractice
- Mining & Energy
- Nightclubs
- Personal Auto
- Personal Insurance
- Professional
- Restaurants
- Retail & Wholesale
- Risk Management Resources
- Safety Topics
- SBA Bonds
- Security
- Seminars
- Technology
- Tourism
- Transportation
- Uncategorized
- Workers Compensation
Archives
- May 2021
- November 2020
- October 2020
- September 2020
- August 2020
- July 2020
- June 2020
- May 2020
- November 2018
- September 2018
- August 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
- December 2017
- November 2017
- October 2017
- September 2017
- August 2017
- July 2017
- June 2017
- May 2017
- April 2017
- March 2017
- February 2017
- January 2017
- October 2016
- September 2016
- August 2016
- July 2016
- June 2016
- May 2016
- April 2016
- March 2016
- February 2016
- January 2016
- December 2015
- November 2015
- October 2015
- September 2015
- August 2015
- July 2015
- June 2015
- May 2015
- April 2015
- March 2015
- February 2015
- January 2015
- December 2014
- November 2014
- October 2014
- September 2014
- August 2014
- July 2014
- June 2014
- May 2014
- April 2014
- March 2014
- February 2014
- January 2014
- December 2013
- November 2013
- October 2013
- September 2013
- August 2013
- July 2013
- June 2013
- February 2013
- November 2011
- October 2011
- September 2011
- July 2011
- June 2011
- March 2011
- November 2010
- October 2010
- September 2010
- April 2010
- February 2010
- November 2009
- October 2009
- November 2008
- August 2008