Estimated reading time: 4 minutes
The Risk Placement Service (RPS) 2025 Cyber Market Outlook reads like a dashboard for the Cyber Insurance Market. Prices cool, capacity swells, and systemic exposures intensify. Vendors sit at the blast radius as incidents cascade across customers. AI accelerates crime and complicates coverage.
Steve Robinson, RPS National Cyber Practice Leader, sets the stakes and the actions, stating, “The market is still being defined by widespread premium reductions and additional capacity, with limit availability increasing, even as risks become more prominent.”
The report says widespread premium reductions and added capacity define market conditions, even as risks grow. Robinson underscores those dynamics with real-world anomalies. In response to an example of higher limits being paired with a lower premium, he replied, “Does that always happen? Absolutely not.” Adding, “the fact that it can happen demonstrates the anomalies we are seeing in the market.”
Limits Rise Despite Elevated Exposure
Carriers that once offered $1–$2 million limits now post $5 million options. Some carriers now consider $10 million and $15 million layers. Demand keeps rising even as risks expand across sectors. Price competition fuels broader availability.
Unsettled Dynamics and Low Premiums
Market stability remains elusive, according to RPS voices. Premiums sit low while some underwriters loosen standards to defend share. New entrants and MGAs add fuel to soft conditions. P&C carriers still view cyber as a growth engine.
“It is currently a buyer’s market.“
Taylor Doll of RPS
Threat Volume Climbs and Attacks Diversify
Global attacks jumped 47% in Q1 2025 to 1,925 per week. Education, government, and telecom faced the heaviest waves. Reports diverge on ransomware frequency, but financial harm remains severe. The picture shows volatile tactics and shifting targets.
BEC Drives Frequency; Vendors Amplify Impact
“Business email compromise continues to lead the way in terms of frequency,” Robinson said. He linked BEC to wire fraud and social engineering losses. Vendor outages and third-party failures cascade across customer networks. Industry concentration magnifies downstream effects.
Carrier Strategies: Standard Words, Uneven Behavior
Policy wordings now look more consistent across the market. Differentiation appears in sub-limits, exclusions, and added services. Yet pricing and claims practices vary widely between carriers. Similar risks can draw very different prices and terms. Carriers now offer more preventative services and tools. EDR and MDR support appear with discounts or bundled access.
“The insurance community… has played a major role” in raising cyber readiness, Robinson said. Carriers require basic data hygiene to bind.
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Claims Severity Grows with Third-Party Incidents
Severity is rising as vendor incidents hit many insureds at once. Dependent business interruption and privacy claims follow outages. Agents struggle to underwrite vendor exposure precisely. Data collection helps book-level visibility, not granular risk pricing.
AI: Catalyst for Crime and Coverage Questions
“Cyber policies are doing a good job” covering attacks executed via AI. Robinson flagged uncertainty around liability from biased or hallucinating models. “That is not contemplated in a traditional cyber insurance policy.”
RPS leaders warn that AI lowers barriers for attackers. Frequency rises as tools improve scale, speed, and deception.
Growing Capacity Meets Long-Term Reinsurance Interest
Gallagher Re expects cyber reinsurance premiums to overtake property or casualty by 2032–2033. Data-driven confidence could spur a “data arms race.” This shift underscores cyber’s march toward insurance heavyweight status. Capital follows credible modeling and controls.
Broker Takeaways for 2025
Stress fundamentals: MFA, EDR with 24×7 monitoring, backups, and patching discipline. Invest in training to cut human-driven loss. Review limits against financial fraud exposures and vendor risks. Align incident response with carrier services and requirements.
Outlook: Buyer’s Market with Moving Parts
“It is currently a buyer’s market,” Taylor Doll of RPS notes. Growth has cooled from the 2021 surge. “Overall, I’m confident with the future of cyber as a line of coverage and growth opportunity for agencies as it continues to mature,” Robinson said. He urged agents to partner with true cyber specialists.
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