Filed Under:Agent Broker, Agency Management

U.S. cyber insurance continues to grow, according to Fitch Ratings

"Future growth in cyber premiums will likely come from more consistent polity terms and conditions as insurers gain better understanding of loss potential and coverage, better cyber underwriting models, as well as efforts to comply with increased cyber regulatory standards across numerous industries, particularly financial institutions," says Fitch's Jim Auden. (Photo: Shutterstock)

Cyber insurance direct written premium volume for the property & casualty (P&C) industry grew by 35% in 2016 to $1.35 billion, according to "Cyber Insurance Market Share and Performance," a new report from Fitch Ratings.

Cyber exposure


Fitch notes that the $1.35 billion figure likely underestimates the industry's cyber premium exposure as there are inherent challenges to breaking out cyber-related premium from other coverages in multi-line coverage products.

Related: Company cyberinsurance — the supply chain dilemma

"Take-up rates for cyber insurance are increasing with frequent reports of computer hacking incidents, including: network intrusions and data theft, as well as high-profile ransomware attacks that are leading corporations to search for broader insurance protection against cyber threats," said Jim Auden, managing director, Fitch Ratings. 

Largest cyber writers


The largest cyber insurance writers are American International Group, Inc., XL Group Ltd, and Chubb Limited. These companies had a combined market share of approximately 40% at year-end 2016. The top 15 writers of cyber held approximately 83% of the market in 2016. However, over 130 distinct insurance organizations reported writing cyber premiums for the year. 

The industry statutory direct loss ratio for stand-alone cyber insurance improved in 2016 to 45% from 50% a year earlier. However, the ultimate profitability of the P&C industry's cyber insurance efforts will take some time to assess as the market matures and future cyber-related loss events emerge.

Related: 5 cybersecurity problems facing mid-size insurance companies

 

Related

Cyber insurance claims: What happens when a breach occurs?

Markel’s director of U.S. Professional Liability explains the claim’s team’s vital role.

Featured Video

Most Recent Videos

Video Library ››

Top Story

6 behaviors that could spawn a sexual harassment lawsuit

Sexual harassment scandals loom large among the events that shaped 2017.

Top Story

2017's 10 most hazardous toys

The Boston-based nonprofit World Against Toys Causing Harm, Inc. (W.A.T.C.H.) has released its annual list of the 10 worst toys of 2017.

More Resources

Comments

eNewsletter Sign Up

Agent & Broker Insider eNewsletter

Proven success tips and essential information to help agents and brokers grow their practice – FREE. Sign Up Now!

Mobile Phone

Advertisement. Closing in 15 seconds.