Consistent with other recent reports, S&P Global Ratings finds global cyber insurance premiums surging, about $12 billion last year and headed to almost twice that by 2025. At the same time, increases in premium rates have moderated. The cybersecurity market has “returned to profitability,” accord to S&P.
The news is less positive concerning reinsurers, which according to S&P “had a difficult 2022 due to low profitability and even underwriting losses in their cyber portfolios.” Their 2022 net (101%) and gross (107%) combined ratios disappointed compared with the primary cyber insurance market.
These needs correcting, as primary insurers handed over > 50% of their cybersecurity premiums to reinsurers last year. On the plus side, there’s plenty of potential retrocession headroom in this sector as the reinsurers iron out their challenges.
This useful report also has some interested findings about the financial resilience of major cyber re/insurers if they were hit with large cyber attacks. See more: S&P Global Ratings report (requires registration).