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The UK cyber insurance market update by Marsh demonstrates a few challenges ahead for the insurance industry. Recent attacks against UK retailers and logistics companies may highlight the maturity of corporate boards management of cybersecurity risks, and reliance on cyberinsurance as a risk transfer tool.
The Marsh report pulls out a few important nuggets.
1. Limit movements trend – There’s a continued trend towards increasing limit of cyber policies.
2. Underwriting – There’s an increase in interest in cyber insurance from industries such as aviation, gambling and hospitality. Insurers are increasingly relying on proprietary broker policy wordings.
3. A rise in claims – Claims were up 30% in Q1 2025 compared to Q4 2024.
4. Human costs – The effect of cyber attacks are not constrained companies. Cyber attacks are being felt by the broader community. Highlighting the need for coordinated incident response from the board room down.
Cyber insurance is a ‘Right of Bang’ risk treatment tool. Unfortunately for both insurers covered companies need to demonstrate active management of cyber risk ‘Left of Bang’. As demonstrated by the attack on Marks and Spencer, the management of cybersecurity risk, including incident management and response would have significantly reduced the effect of cyber attack on the company.
Cyber risk transfer and the effective use of risk capital has to be balanced ‘Left and Right of Bang’. With organisations taking a proactive stance on risk management to reduce cyber risk, using cyber insurance to cover gaps in risk management. Not using cyber insurance as the main risk mitigation tool.
@Thaddeus Dziekanowski Brian D. McCarthy Faisal Khan
Veritas GRC
#cybersecurity #cyberriskmanagement
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