Local governments looking for cyber insurance are facing a changing market, and by some accounts, cyber insurers today charge more, while covering less.
Cyber insurers had initially based premium prices and coverage offerings on guesswork about an emerging area. But now they’ve seen enough cyber incidents to understand what payouts cost them, said Alan Shark, executive director of the Public Technology Institute. As such, many insurers have reduced what they’ll cover, while also asking for premiums high enough to be nearly unaffordable for some local governments. Other insurers have deemed cyber too risky and pulled out of the space entirely, reducing applicants’ options.
Cyber risk management tools provider KYND’s 2024 survey of 100 brokers and insurers found that nearly two-thirds believed the U.S. cyber insurance market would harden over the next 12 months.
Insurers are restricting how much they’ll cover certain kinds of losses, including setting lower sublimits on ransomware incidents. The Association of Washington Cities (AWC) offers a risk management pool to its local government members, while…
