Cyber Security And Privacy Insurance Claims
This is the fifth installment of our series of articles reviewing some of the key trends and developments currently impacting the U.S. insurance industry.
To date, the vast majority of cyber coverage decisions have involved traditional first-party, third-party, and crime/fraud policies. Claims under these policies are commonly referred to as silent cyber claims. Most insurers in the cyber-insurance market have now issued several iterations of cyber-specific policies. Rulings under these policies are expected to be rendered with increasing frequency over the next couple of years.
- Indeed, cyber-insurers experienced a steep increase in claims over the past couple of years, driven primarily by ransomware, often coupled with data extraction and business email compromise events. The costs associated with ransomware claims, in particular, have risen dramatically due to increased ransom demands, threats to disclose extracted data, and related business interruption costs. The pandemic-driven massive shift to remote work spurred additional cyber claims activity. As a result, industry leaders are anticipating a hardening of the cyber-insurance market, as well as increased premiums and underwriting scrutiny.
- Zurich and Advisen’s 11th Annual Information Security and Cyber Risk Management Survey was released in October 2021.[1] Among the interesting finding, 83% of respondents now buy cyber insurance, with 66% carrying stand-a-lone…
