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First-Ever
In a first-ever, premiums for cybersecurity insurance coverage in the U.S. fell 2.3% in 2024, according to AM Best’s latest report. This marks the first recorded decline since 2015, with total direct premiums written now below $7.1 billion. The loss ratio remained below 50%, suggesting that cyber insurance continues to yield profits. The AM Best report attributes the premium decrease to pricing changes rather than lower exposure levels.
Premium Decrease
“When premium grew during the hard market cycle, the growth significantly outpaced the pricing increases,” said Christopher Graham, senior industry analyst at AM Best. “Considering that the premium decrease is close to the pricing decrease, that would indicate that the demand for cyber insurance is steady.”
Captive Insurers
Some large companies are moving their cyber risks to single-parent captive insurers. These firms with strong loss records prefer internal risk management over the external market.
Surplus lines carriers, which gained ground during the challenging 2020-2022 hard market, maintained or slightly expanded their market share. They continue to dominate complex cyber risks in both primary and excess layers.
AM Best maintains a stable outlook on the global cybersecurity insurance coverage market. The cautious underwriting approach is essential amid today’s dynamic risk landscape.
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