A report by GlobalData has found the cyber insurance industry is predicted to exceed a $20bn gross written premium (GWP) value by 2025.
According to Insurance Times, the GlobalData report has detailed that the global cyber insurance market will reach $20.6bn in GWP by 2025.
The publication remarked that the data shows the market is continuing to thrive post-Covid. In 2020, the cyber insurance market saw heady growth of 33.5% at a total value of $7bn. For 2021, the GlobalData report expects the industry to grow by a rate of 27.3% and reach an overall valuation of $8.92bn.
Going forward, GlobalData expects the industry to be worth $11.09bn in 2022, $13.73bn in 2023 and $16.86bn in 2024.
The rise in the uptake of cyber insurance comes as no surprise as many companies were forced to digitise their operations and work from home until further notice in the wake of the lockdowns due to the Covid-19 pandemic.
A report by the FBI earlier this year found a staggering 100% increase in cybercrime complaints between March 2020 and May 2021 – with over $4.2bn being lost to cybercriminals globally.
Elsewhere, a 2020 report by IBM claimed that on average, data breaches cost UK enterprises alone around $3.8m – a finding that may be spurring on the rapid growth of the cyber insurance market.
GlobalData insurance analyst Ben Carey-Evans said, “The cyber insurance market has seen rapid expansion in recent years, with customers enjoying high coverage limits, flat rates and abundant capacity as insurers sought to capture business in a highly competitive market.
“Despite lower cover limits and increasing premiums, we expect the cyber insurance market to see continual, strong year-on-year growth up to 2025.The need for robust cybersecurity and cyber insurance is becoming apparent to businesses of all types and sizes, as the frequency and severity of cyberattacks continue to rise.
Carey-Evans also highlighted the fact that Covid-19 has brought about a ‘permanent shift’ in the way businesses and consumers operate, with remote working practices expected to stay and digital consumer channels seeing more uptake than before the pandemic.
He concluded, “This lasting shift in behaviour will push the demand for both commercial cyber insurance and, to a lesser extent, personal cyber insurance in the coming years.”
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