Cybersecurity Insurance Market Forecasts to 2028 - Global Analysis By Component, Insurance Coverage, Insurance Type, Organization Size, End User, End User and By Geography

According to Stratistics MRC, the Global Cybersecurity Insurance Market is accounted for $11.9 billion in 2022 and is expected to reach $38.4 billion by 2028 growing at a CAGR of 21.6% during the forecast period. Solutions for cyber insurance help businesses reduce the risk of cyberthreat activity like data breaches and cyberattacks. The expense of internet-based attacks on information governance, IT infrastructure, and information policy, which frequently are not covered by conventional insurance products and commercial liability plans, are shielded from by this measure. Businesses are implementing cyber insurance coverage as a result of the rising data breaches and cybersecurity concerns.

According to the Nuspire threat report, there were 26,156,165 exploitation events,1,597,858 malware events, and 1,620,910 Botnets events in 2020.

Market Dynamics:

Driver:

Surge in mandatory cybersecurity regulations and legislations regarding cybersecurity

Many steps have been taken by law enforcement organisations and governmental regulatory entities to improve data security and protection. Covid19 has made policyholders, brokers, insurers, and agents aware of the necessity for a cybersecurity insurance coverage. For instance, the California Assembly has presented a bill that would mandate cybersecurity insurance for all state contractors who handle regulated and protected personal information. The expansion of data privacy laws, such as the Health Insurance Portability and Accountability Act (HIPAA) in the US, the global Payment Card Industry Data Security Standard (PCI DSS), and the General Data Protection Regulation (GDPR) of the European Union (EU), is motivating insurance companies to prioritise cybersecurity insurance measures. The rate of cyberattacks has dramatically increased as a result of rising digitalization, particularly during the COVID-19 epidemic. So, it is anticipated that the adoption of the cybersecurity insurance industry in the future will be driven by complicated governance needs and regulations in data security.

Restraint:

High Premium Cost to Hamper Market Growth

With protection from cyberthreats and crimes, cyber insurance benefits various businesses, driving up demand for insurance coverage. Nonetheless, the market faces issues with the high premium insurance policy cost. The insurance firms' increase in the cost of policies is impeding both their renewal and continuation. As prices rise, corporations like American International Group Inc. are raising premium rates by 30% and lowering coverage limitations. Small and medium-sized businesses (SMEs) with limited resources are hesitant to invest more in security insurance. It follows that high price will likely impede market expansion.

Opportunity:

Adoption of artificial intelligence AI and blockchain technology for risk analytics

Among the most recent hot technologies, AI and blockchain are predicted to give risk analytics solutions increased capabilities and offer up new business opportunities. These technologies' integration with risk analytics programmes would help cybersecurity insurance companies with some of their most pressing problems. The development of modern technology allows for quicker transactions and settlements, which help financial institutions and their customers execute transactions and settlements more quickly while also doing away with the need for intermediate fees. In order to analyse claims, manage reserves, and provide policy coverage, risk analytics solutions are crucial. In order to quickly analyse data and produce insights, a number of suppliers have started combining cutting-edge methodologies like statistical modelling, image processing, and machine learning (ML).

Threat:

Despite soaring cybersecurity risks, cyber insurers grapple to gain traction

Insurance companies struggle to sell stand-alone cybersecurity insurance products despite the surge in security events. Despite the growth in security and ransomware events, mid-sized businesses are sluggish to purchase stand-alone cybersecurity insurance coverage. Cyber hazards are the top issue for risk managers in both SMEs and large companies in the United States, according to the Allianz Risk Barometer survey. The market for cybersecurity insurance is being constrained by a number of problems, including high pricing, limited coverage limits, complicated coverage terms, and a lack of consumer knowledge of these plans.

Covid-19 Impact

The pandemic has forced people and companies to adopt remote working and has hastened the digitalization of company processes. Enterprise Virtual Private Network (VPN) servers are now required by businesses as more workers choose to work from home. Because of this, cybercriminals all around the world recognised opportunities to profit from the situation. Because hackers are utilising this issue as a lure to imitate brands and trick employees, the pandemic period saw an increase in mail spam, ransomware attacks, and phishing attempts. Both large and small businesses can obtain complete cyber coverage through insurance policies in the case of an attack or breach. Most cyber insurance policies offer a wide variety of coverage that is pertinent to the present situation.

The standalone segment is expected to be the largest during the forecast period

The standalone segment is estimated to have a lucrative growth, due to its complete cover policy. An organisation is shielded from legal action brought about by security or privacy breaches that claim a failure to protect sensitive information through a standalone type of insurance. Moreover, standalone policies protect against a variety of asset risks, such as business interruption, data loss/destruction, and money transfer loss.

The BFSI segment is expected to have the highest CAGR during the forecast period

The BFSI segment is anticipated to witness the fastest CAGR growth during the forecast period. Concerns about cybersecurity are likely to be sparked by the growing digitalization of businesses, the expansion of customer-sensitive data, the use of mobile applications, and online banking. The banking sector is likely to be a popular target for hackers since it retains such a vast amount of client data. The BFSI sector's need for cybersecurity insurance will likely rise as a result.

Region with highest share:

North America is projected to hold the largest market share during the forecast period owing to this region's stable and well-established economies, which enable it to make large investments in research and development (R&D) operations, new technologies for the cybersecurity insurance industry are being developed. The majority of leading players in the cybersecurity insurance market are anticipated to be the main drivers of the market's growth in this area.

Region with highest CAGR:

Europe is projected to have the highest CAGR over the forecast period, owing to the altering insurance regulatory laws that raise the demand for these insurance services are to blame for the regional expansion. According to data by Wavestone, Marsh, and the legal firm CMS, insurance claims are increasing across Europe faster than the number of policies, as enterprises' use of digital technology leaves them open to criminal assaults.

Key Players in the market

Some of the key players profiled in the Cybersecurity Insurance Market include CAN Financial Corporation, Travelers Indemnity Company, Chubb, Zurich Insurance, The Hanover Insurance, Inc., AXIS Capital Holdings Limited, American International Group, Inc., Beazley Group, AXA XL, XL Group Ltd, BCS Financial Corporation, Berkshire Hathaway Inc., Aon PLC, Bin Insurer Holding LLC, Lockton Companies Inc., SecurityScorecard Inc., Allianz Global Corporate & Specialty and Munich Re Group.

Key Developments:

In October 2022, AXA XL launched an incident response team in the Americas. The Cyber Incident Response team determines commitment to the clients and helps them before, during, and after cyber incident.

In July 2022, AXA XL announced cyber insurance roles and regional management appointments in the U.S. These roles help to focus on the company's growth strategy and discover innovative methods to address complicated cyber & technology risks.

In September 2021, Zurich Insurance Group joined Toronto-based Insurtech BOXX Insurance. This collaboration provided fully integrated insurance and cyber security solution for SMEs, families, and consumers.

In September 2021, BlinkSM by Chubb and USAA Insurance Agency collaborated to offer personalized cyber protection to families and USAA members. The standalone insurance policy includes expenditures related to a personal cyber event, including fraudulent wire transfers, identity theft, ransomware extortion, and cyberbullying.

In March 2021, CAN launched CAN CyberPrep. It is an upbeat program of cyber risk services intended to help organizations take a complete approach to cyber threats and help CAN cyber policyholders identify, mitigate, and respond to threats.

Components Covered:

• Solution
• Service
• Other Components

Insurance Coverage Covered:

• Data Breach
• Cyber Liability

Insurance Types Covered:

• Packaged
• Stand-Alone

Organization Sizes Covered:

• Large Enterprises
• SMEs

End Users Covered:

• Technology Providers
• Insurance Providers
• Other End Users

Regions Covered:

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • Italy
  • France
  • Spain
  • Rest of Europe
• Asia Pacific
  • Japan
  • China
  • India
  • Australia
  • New Zealand
  • South Korea
  • Rest of Asia Pacific
• South America
  • Argentina
  • Brazil
  • Chile
  • Rest of South America
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • Qatar
  • South Africa
  • Rest of Middle East & Africa

What our report offers:

• Market share assessments for the regional and country-level segments
• Strategic recommendations for the new entrants
• Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
• Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
• Strategic recommendations in key business segments based on the market estimations
• Competitive landscaping mapping the key common trends
• Company profiling with detailed strategies, financials, and recent developments
• Supply chain trends mapping the latest technological advancements

Free Customization Offerings:

All the customers of this report will be entitled to receive one of the following free customization options:

• Company Profiling
  • Comprehensive profiling of additional market players (up to 3)
  • SWOT Analysis of key players (up to 3)
• Regional Segmentation
  • Market estimations, Forecasts and CAGR of any prominent country as per the client's interest (Note: Depends on feasibility check)
• Competitive Benchmarking
  • Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances