Cyber ​​Insurance Rate Rise Welcomes Slowdown – Marsh

Improvements noted in the report include:

  • New capacity and insurers continue to enter the market
  • Organizations are stepping up their cyber hygiene
  • Carriers are strengthening their risk engineering and risk management capabilities
  • Enhanced communication between governments, law enforcement, businesses and the insurance sector

“Over time, we have a clearer picture of a more stable market on the horizon,” Marsh said. We are optimistic that we will continue to move forward.”

But while the market is improving, Marsh says operator behavior lacks visibility into coverage clarity, contract certainty and pricing mechanisms.

“This causes significant frustration for buyers trying to make informed decisions about the investments needed to strengthen and insure their cyber resilience,” said Marsh. “As the cyber insurance market continues to mature, it is critical that all stakeholders apply not only the lessons of the last two years, but lessons learned throughout the market’s 25+ year history. This allows the market to become stronger and more resilient over time.”

Read the following: Cyber ​​Insurance Becomes More Ubiquitous and Important – Report

Insurers continue to review their strategies to stabilize the market, Marsh said. This includes implementing operational and tactical actions such as changes to risk appetite, product mix and support services provided to insured persons.

According to Marsh, implementing these strategies can lead to unintended negative consequences, which can further complicate things like:

  • Continued growing pains in the market
  • The ever-present ubiquity of cyber risk
  • Ongoing concerns about catastrophic and cumulative risks, including ransomware, supply chain exposure, security and privacy regulations, and nation-state activity

“If insureds do not feel they are provided with clarity, transparency and certainty of coverage, they will lose confidence and comfort in working with the cyber insurance market,” said Marsh. . “This continues to be a product that continues to prove effective in protecting balance sheets, paying claims and enabling organizations to responsibly understand, measure and manage cyber risk. It happens nonetheless.”

Marsh said insurers need to pay close attention to the potential impact of new strategies before they are widely adopted. According to the company, maintaining a constant feedback loop between brokers, insurers, insureds and other stakeholders can alleviate some of these challenges. By providing transparency to all parties, that feedback loop also builds trust across the cyber insurance market.

Leave a Comment