Analysts highlight that Beazley, a specialist in cyber insurance, projects an 18% compound annual growth rate for its coverage from 2024 to 2030. Other significant players in the industry, including Munich Re, Hiscox, Axis Capital, and Chubb, are also noting a rise in demand.
In 2023, the world experienced over 317 million ransomware attacks, a decrease from 493 million in 2022 and 623 million in 2021, as reported by cybersecurity firm SonicWall. The firm observed a 36% decline in ransomware incidents globally, with a one-third reduction in the U.S. and Europe, although malware attacks increased by 11% worldwide. Bloomberg Intelligence attributes these declines to a combination of slowing economic activity and successful efforts against ransomware criminals.
Notably, the second quarter of 2024 witnessed the second-highest number of reported ransomware attacks in a single quarter, as detailed in Corvus Insurance’s Q2 2024 Cyber Threat Report, which identified 1,248 victims during this period. While insurers experienced significant increases in cyber insurance premium rates in 2022, those rates are now beginning to stabilize. Beazley reported a 5% decline in its 2023 cyber rates, following a substantial 40% rise in 2022.
“United Healthcare’s Change Healthcare medical billing processor, which links one third of Americans to health-insurance payments, suffered a cyber-attack in February, crippling the payments systems of a significant number of hospitals. The May attack on Ticketmaster compromising 560 million customer records is a further example of the unrelenting cyber-crime challenge,” commented Kevin Ryan, Senior Insurance Analyst at Bloomberg Intelligence.
He continued: “An estimated $8 trillion was lost globally to cybercrime in 2023, according to technology consultants Cyber Security Ventures, a significant increase vs. the $600 billion McAfee estimated in 2018. It’s clear the seriousness of attacks is increasing. As such, Allianz has said that cyber risk is the No. 1 concern globally, along with business interruption.”
Within mature markets, such as the US and Europe, analysts noted that cyber insurance may be one of the few areas of insurance to record “real growth.”
He added: “Insurers have the infrastructure to work collaboratively with clients and provide services before and after malware incidents, thus minimizing potentially negative outcomes. Cyber threats and infiltration techniques are moving to more sustained levels – known as “advanced persistent threats” – away from quick, one-off acts.”
