While the average total cost of risk last year softened, cyber insurance costs saw a significant increase instead, one recent survey has found.
Advisen’s RIMS Benchmark Survey for 2018 found that despite record-breaking natural catastrophes, the average total cost of risk (TCOR) saw a 3% drop last year – reflecting a four-year trend of decreases. Specifically, TCOR decreased from $10.07 per $1,000 of revenue in 2016 to $9.75 per $1,000 of revenue in 2017.
The decline was driven by decreases in property, liability, workers’ compensation, management liability, and professional liability costs, RIMS said. A drop in overall risk management administration costs was also suggested as a factor in the decline of TCOR.
“Market conditions are favorable for insurance buyers,” commented Advisen co-founder and chief strategy officer David Bradford. “A competitive insurance market resulting from a chronic overabundance of risk capital strongly contributed to TCOR decreasing steadily since 2013.”
Interestingly, the survey found that cyber insurance is the only category that did not show any price softening.
According to the survey, the average cost…
