Is now the right moment to consider placing cyber insurance? Or to re-evaluate your existing policy to make sure you’re fully covered and aren’t overpaying?
According to a new analysis conducted by Marsh & McLennan Agency, the hardening market for cyber insurance is an opportune time for organizations to assess their risk and coverage options.
Spate of High-profile Attacks
The cyber insurance market could double over the next three to four years, and 2021 rates could rise as much as 50% higher, according to Marsh.
The recent attacks on Microsoft Exchange and Solar Winds are just two of many high-profile incidents. Since 2018, the number of cyber events has grown 150%. To date, there have been more than $20 billion in ransomware claims. Overall, cybercrime costs are projected to reach $10.5 trillion by 2025, according to Cybersecurity Ventures.
Higher claims are trending for ransomware, the related business interruption costs and policies liable for a cyber loss, according to MMA’s Q4 2020 U.S. Business Insurance Report.
Buyers are requesting higher coverage limits only to find that price and carrier appetite for risk have become stumbling blocks from implementing a comprehensive cyber insurance strategy.
Insureds are also starting to see restrictions or sub-limits in ransomware coverage. Ransomware frequency and severity continues to reduce carriers’ willingness to underwrite coverage to control their loss severity.
Cyber Rate Increases Surge
Source: Marsh PlaceMAP
Purchasing comprehensive cyber coverage is prudent, despite the rising costs. The challenge is to make sure your organization secures the right coverage. There are a growing number of “cyber lite” offerings. While less expensive, they lack or have limited coverage options for ransomware and business interruption.
One of the most important ways to address cyber risk is to have a clear understanding about the external and internal cyber environment facing your organization. MMA can help identify and measure your organization’s cyber risk.
Our Cyber Resiliency Network assists with two distinct areas of cyber risk management: proactive information security and legal components of compliance and risk management.
Reach Out to MMA
The team at Marsh & McLennan Agency is here to help. We can review your policies and develop a strategy. We can work with you to assess regulatory issues, as well as litigation risk, incident response, and implement best practices.