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Underwriting cyber insurance has taught the re-insurance industry allot about underwriting complex, catastrophic risks, that one assumed they already knew a lot about? Lloyds recently announced that it would not support the underwriting of Nation State Attacks, that is likely put in place to manage the broad impact of a cyber attack on critical infrastructure, and the reinsurance risks of silent cyber.
I am not convinced that the cyber market has matured. The only visible solutions put forward to manage cyber risk include increasing premiums and reducing coverage. With cyber insurance take up still relatively low with gross written premium expected to grow from $7Bn in 2020 to $20Bn in 2025. The market is predicted to grow 2.8 times. There needs to be innovation.
With no visible solutions to support organisations manage the risk; risk transfer costs getting higher and coverage being reduced the outlook for cyber insurance maybe uncertain. The insurance industry faces the same resourcing problem as all industries, attracting and retaining cyber talent and innovation is lacking.
There needs to be radical solutions provided by the insurance industry adopting similar approaches to other insurance classes that require independent oversight and assurance of risk mitigation. Oversight and assurance that is being proposed by regulators under cyber security legislation.
https://lnkd.in/ekViSsG3
Ted Dziekanowski
#cyberinsurance #cybersecurity
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