Munich Re Group, a provider of reinsurance, primary insurance and insurance-related risk solutions, is reportedly to increase its cyber cover prices in some regions.
According to a report from Reinsurance News, Claudia Hasse, chief executive manager at Munich Re, said given the accumulation potential the firm sees in cyber re/insurance, it plans to increase cover prices in Germany and Europe.
Hasse is responsible for non-life business in Germany, cyber business in Europe and Latin America, and the German Pharmapool.
She noted in a brief ahead of the Baden-Baden re/insurance meeting that the European cyber market has grown from €400m to €2bn in the last five years, according to Munich Re’s estimates.
Munich Re’s combined ratio worldwide is at around 85%. This is slightly higher in Europe but Hasse explained this is driven by a few large single losses and the overall lower-rate level compared to other regions such as the US.
Munich Re added that there are two reasons for this out-performance. the first being that it chooses its partnerships very consciously, and the second being the firm supports its clients with all of its know-how in pricing, wording, and risk assessment, and it also helps them provide pre-and post-incident services.
Aditionally, Hasse noted in the brief that there are clear limits to the insurability of cyber, adding that Systemic risks like critical infrastructure or war cannot be insured.
She said, “it’s really important to understand that war is excluded already right now in our wordings.”
Adding, “The goal of the current discussion is to make this exclusion more reflective of particular cyber warfare circumstances for the London market clauses have been developed already with Munich Re participation and those clauses are currently being adapted to the individual European markets, and will then be implemented. This is important to create confidence regarding cyber so that new capital, especially from the capital markets, is ready to come in.”
Earlier this year, Coalition, a cyber insurance provider, acquired US property and casualty insurer Digital Affect Insurance Company from Munich Re Digital Partners US Holding Corporation.
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