According to ENISA, the number of supply chain attacks quadrupled in 2021 compared with 2020. After several years of significant losses, carriers are limiting their cyber exposure with more. Some decreases in the 5% range on more favorable . They can ask the right questions, carry out assessments or penetration testing, as well as guide businesses to reach the required level of cyber resilience faster. While were seeing pricing easing up, were also seeing more industry specific underwriting, Robinson noted. This report highlights some of the main cyber risk trends we see from an underwriting, risk consulting and claims perspective, such as the growing cost of ransomware attacks - which has been the major loss driver in recent years, the targeting of more smallersized companies by hackers, the increasing frequency and sophistication of business Part of protecting your business is following cybersecurity industry trends, understanding how criminals penetrate systems, and taking the precautions to keep them out. Cyber Espionage: Cyber espionage refers to unauthorized access of sensitive data or IP for economic, competitive or political gain through cyberattacks. Our experts continually refine our internal models on the basis of our own and third-party data, and with a particular focus on accumulation risks. In other industries, reputational damage tends to occur in the aftermath of one-off events such as natural disasters and can often be predicted to some extent (see Global Cyber Crime, Fraud & Ransomware Survey). When attacks strike, insurers call on IR experts to verify whether the client legitimately had all the protective measures in place they said they did when applying for coverage. Identity And Access Management (IAM): IAM security manages digital identities and controls access to data, systems and resources to ensure IT security. Businesses must and will continue to manage the following issues: Cyber health is not the only unquantifiable factor in the cyber space risk is similarly elusive. In 2021, cyberattacks on all sizes of companies were up 15%, according to a report by ThoughtLab, and the number of material breaches rose by nearly 25%. Attackers rely on a mix of tried-and-tested methods as well as their own expanding repertoire of tactics and approaches. The early approach whereby attackers specialised decryption and later on exfiltration of stolen data is evolving to include multiple extortion schemes. Use of multi-factor authentication. . Businesses will similarly feel the benefits of MSSPs involvement in the process of seeking cyber insurance, as they will have a reason to work harder to improve their overall cyber resilience, and do so against clear benchmarks. Both incidents show that, big game hunting, i.e. While AXAs decision only applies to France currently, it has the potential to open the door for other insurers to follow suit in the future. This is important for insurers, as they want to ensure a level of security to minimize their potential losses in the . In-depth industry statistics and market share insights of the Cybersecurity Insurance sector for 2020, 2021, and 2022. Annual premiums have reached an estimated $10 billion and are expected to grow to nearly $23 billion by 2025, according to Fitch Ratings. In Munich Re's opinion, 2021 was not an exceptional year from a cyber perspective. Digital Life Insurance. The coverage limits with regard to the resilience of portfolios are mapped in accumulation scenarios, continuously monitored and, if necessary, adjusted. Gartner predicts that by 2024, organizations adopting a cybersecurity mesh architecture will reduce the financial impact of individual security incidents by an average of 90%. Scenarios such as the failure of critical infrastructure (e.g. The risk situation remains extremely dynamic. Agents and brokers play a key role in helping clients mitigate their risk and preparing them for 2023 renewals. Our approach in cyber insurance is unchanged: disciplined in underwriting and stringent in risk management. This development affects a multitude of sectors, including the insurance sphere. MSSPs can support insurers first and foremost by helping businesses qualify for cyber insurance more easily. All of these players will make use of expertise that has already been developed in the insurance market. This means companies who are considering purchasing cyber insurance will need to keep up with a changing market and adapt. Throughout these investigative processes, insurers are working more closely with cybersecurity professionals to better understand where cyber risks lie at an organization. All industry sectors are interested in cyber insurance. On the other hand, insurers can only do so much to help businesses get their house in order. Some criminal perpetrators also cooperate with state actors. Social engineering attacks have outpaced ransomware ones this year, fuelled by the global shift to hybrid working. While the cyber insurance industry has promising growth, it's also facing alarmingly increased loss activity. At the same time, the cyber insurance market is one of the fastest growing segments in the insurance industryand that isn't expected to change anytime soon. The global cybersecurity as a service (CSaaS) market is expected to register a CAGR of 12.6% in the forecast period (2021 - 2026). According to BusinessToday, cyber attacks increased by 50% in 2021 compared to the previous year. Cyber insurance is basically . As a result, businesses are turning to cyber-insurance for business continuity. This is the dilemma both insurers and businesses will grapple with in 2023. And it is not only in Germany that the situation is tight to critical (BSI). However, as we reported last year, the cyber insurance . Cyber insurance trends in 2023. Your budget should include obtaining the required insurance policies according to state and local laws. 18. Doing nothing to prevent cyber threats leaves companies vulnerable to more than just a cyberattack or breach. . In Section 4.1.1, OCE describes the core challenges with the current state of the cyber Cyber attacks on the healthcare sector up by 71% ISP/MSP up by 67% Communications +51% Government and military sector up by 47% We experienced an all-time high in cyberattacks during 2021, with Q4 taking the most blows. Since cyber-attacks are inevitable, it has become necessary to get yourself covered under a cyber insurance policy. telecommunications or the power supply), as well as a possible cyber war, exceed the limits of insurability and are consequently excluded. Member of the Munich Re Board of Management. Its a positive sign shining light into a tumultuous market, which in 2023 will continue to face capacity challenges driven by increased demand, two-plus years of significant premium increases, more judicious limits deployment, and the exit of some players from the market. Read more eBook 2017-2023 ACA Group. 11. For example, Hiscox, a leading cyber carrier, showed $1.8 billion in cyber losses in 2019, which was up 50% from the prior year. The European Union Agency for Cybersecurity (ENISA) recognised and analysed the increased risk from cyber-attacks on or via supply chains in its Threat Landscape for Supply Chain Attacks report. Whereas in the past it was not uncommon for a midsize firm to have $10 million in coverage, that same firm today is likely only being offered $5 million or less by most carriers. Ransomware business reached a new peak last year and is attracting more and more criminals. The provider is responsible for securing the infrastructure, access, patching and configuration of hosts/networks, while the customer is responsible for managing users and access privileges, protecting cloud accounts, encrypting/protecting data and maintaining compliance. Read on to set your policies. Munich Re sees cyber premiums worldwide standing at US$ 9.2bn (beginning of 2022) and estimates that they will reach a value of approximately US$ 22bn by 2025. Particularly noticeable was the fact that smaller companies and government institutions often continue to be inadequately protected and are therefore more at risk overall. Ransomware is becoming more common - and expensive. Carrier applications are getting more difficult, and underwriters want to see proof of cybersecurity protocols, such as multifactor authentication, mandatory employee cyber training and consequences for those employees that do not meet company cybersecurity requirements. Northeastern University defines multi-factor authentication as a system in which users must use two . Munich Re budgets for particularly critical digital dependencies, e.g. Certainly, we never want our clients to be getting less coverage than they had the year before. The report focuses on Cybersecurity Insurance Market size, share, growth status, future trends, volume, and key market dynamics. While brokers and their clients should acknowledge that a lot of hard work has been done, cyber security is an evolving process. It looks like your browser does not have JavaScript enabled. Multi-factor authentication (MFA) is becoming a key requisite of many insurers alongside other controls such as the presence of an end point detection and response solution, secured and encrypted backups, privileged access management, business continuity and incident response planning, and cybersecurity awareness training to name a few. Cyber insurance policies typically require EDR because it helps to reduce the risk of a cyber attack. These incidents can do a lot of damage to a company's network and result in serious costs to the business. On the one hand, UK businesses face a plethora of pressures from rising cyber insurance premiums an increase of66%year-on-year by 2022 Q3 and shrinking coverage (see about Global Cyber Market). There are multiple types of insurance policies you can get to protect your business. The public sector, including education, also faces fewer options for risk transfer after the pull-out of several carriers from the space due to skyrocketing claims (see TOP 15 U.S. Cyber Insurance Companies). Read more. These cookies ensure basic functionalities and security features of the website, anonymously. With all the data and scores at their disposal, insurers are able to quantify their own risk, too, and make better-informed decisions as they navigate the increased demand for their services. Companies are more aware of their cyber risk and are looking at the insurance market to mitigate that risk. Social engineering tactics involve using manipulation to gain access to cybersecurity weaknesses. Do I qualify? This shortage will continue to be a concern in 2023, forcing companies to invest in training and retaining talent or outsourcing cybersecurity tasks. However, you may visit "Cookie Settings" to provide a controlled consent. Ransomware: A malicious software that encrypts files and demands ransom for their decryption, ransomware attacks pose a significant threat in 2023. India was in the top three nations that have experienced a lot of ransomware attacks. This cookie is set by GDPR Cookie Consent plugin. Some insurers charge as little as $10 a month for $25,000 worth of coverage. Compare roughly one-quarter (26%) in 2016 to one-half (47%) in 2020. To help guide this research and to receive actionable data on premium rates, coverage limits, and more, take the 2022 Aponix Cyber Insurance survey here. GIPS is a registered trademark owned by CFA Institute.