Benchmarking Trends: Operational Risks Drive Cyber Insurance Purchases
Standalone cyber insurance purchases among US-based Marsh clients increased 27% from 2014 to 2015, driven mainly by an increasing awareness and appreciation of cyber risk, from the boardroom to the data center.
This continues a pattern of strong growth in cyber insurance purchasing, which grew 32% increase in 2014 over 2013, and 21% increase in 2013 over 2012.
Among the key findings from the report:
- The manufacturing industry saw the biggest uptick in new cyber purchases in 2015, a 63% increase over 2014.
- The amount of limits purchased was up 15% on average in 2015 to $16.9 million for clients of all sizes.
- Overall capacity in the cyber market remains abundant with more than $500 million in limits available for a given risk.
The report also explores several areas companies will be monitoring as they assess, manage, and respond to cyberthreats, including:
- Risk modeling: As more boards demand quantitative support for risk finance decisions, there is increased interest in the using of modeling tools for cyber risk.
- Regulatory developments: State and federal regulators in the US and those in individual countries and regions are weighing in on cyber risks. For example, the EU Network and Information Security Directive is expected to be finalized this year.
- The connected world: The expansion of cyber risk coincides with the rise of cyber-physical systems — the Internet of Things — that is widely discussed in reports such as the World Economic Forum’s Global Risk Report 2016.
- Coverage innovations: The risks that cyber events now pose to physical assets, operations, and intellectual property hold the potential for damage equally as serious as the loss of personal information.
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