Communications of the ACM
Cyber Insurers Raise Rates Amid a Surge in Costly Hacks
Turbulence in the cyber insurance market kicked into high gear after the May 2021 hack of Colonial Pipeline Co.
Credit: jim lo scalzo/EPA/Shutterstock
Insurers significantly increased premiums for cyber coverage over the course of 2021, as a string of high-profile attacks and government action helped boost demand for products, data collected by industry bodies shows.
Direct-written premiums collected by the largest U.S. insurance carriers in 2021 swelled by 92% year-over-year, according to information submitted to the National Association of Insurance Commissioners, an industry watchdog, and compiled by ratings firms.
Analysts say that the increase primarily reflects higher rates, rather than insurers significantly expanding the amount of money they are willing to cover.
"The amount of rate that is being generated in this market is quite astonishing, just in terms of the percentages that are out there," said Tim Zawacki, principal research analyst at S&P Global Inc.'s Market Intelligence business.
From The Wall Street Journal
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