Cyber reinsurance market is still attractive despite ransomware attacks up 176% in Q2 2023 over the same period in 2022.

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Cyber reinsurance market is still attractive despite ransomware attacks up 176% in Q2 2023 over the same period in 2022. While attack frequency has increased claims frequency has not. Are we seeing more self-insurance?

Pricing in 2023 was 2.5x times higher than 2020, with a combined ratio of ~74% in 2022 demonstrating that the class is highly profitable when compared to other parts of the P&C market.

Attacks are on the up (the will continue to increase), Premiums are up, claims are down on 2022. Are we in danger of hiding behind there’s figures to justify the profits? Its not fire starting to say that the recent Systemic cyber report by Lloyds of London (https://lnkd.in/eFaCFND8) doesn’t paint a great picture, nor the more recent attacks against U.S bond markets or Australian Maritime Logistics.

If ransomware continues to increase and companies rely on self insurance the longer term effects on industry should be of concern, as it does not look like we’re fixing the cyber problem. Where’s the cyber insurance growth capital going to come from, ILS products? They work only if the risk to capital falls, or an insurance backstop?.

Has the insurance and re-insurance industry considered what it can do to support clients comply with cyber regulation?

Ted Dziekanowski Brian D. McCarthy Rachel V. Rose, JD, MBA Bob Dix

#theaugusatgroup #cybersecurity #cyberriskmanagement

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