By A.M. Best
OLDWICK, N.J., August 20, 2018-A modeled single-event cyber catastrophe would generate meaningful to significant gross losses for three of the top 20 cyber insurance providers, ranging from 15% to 119% of these companies’ estimated 2022 policyholder surplus under a stress-test scenario.
In the new Best’s Special Report, “Cyber Insurance Market: Stress Testing the Future,” A.M. Best worked with Guidewire’s Cyence Risk Analytics team to extrapolate and model current cyber insurance market trends to 2022. As part the approach, five typical policy profiles were created, each with certain attributes such as business revenues, specific policy limits, self-insured retentions and attachment points.
Using two scenarios as described in a Lloyd’s 2017 emerging risk report – a cloud service provider interruption and mass vulnerability – A.M. Best applied Guidewire’s Cyence Risk Analytics application to the top 20 carriers’ modeled cyber portfolios in various scenarios to model their gross loss potential. In the first scenario, numerous cloud-based customer servers fail, leading to widespread service and business interruptions. In the second scenario, a common software…
