Cyber insurance in P&C industry grew by 22% in 2020: Fitch Ratings

According to rating agency Fitch Ratings the Cybersecurity and Identity Theft Insurance Coverage Supplement reported that cyber insurance direct written premiums for the property & casualty (P&C) industry grew by 22% in 2020 to over $2.7 billion.

Cyber insurance continues to be viewed as a growth market for P&C insurers, as demand for coverage is unlikely to decline given recent growth in incidents, and premium rate increase momentum is unlikely to subside near term.

Growth in standalone coverage will be fuelled by policyholder and insurer interest in reducing ambiguity in coverage or “silent cyber” risks.

The analysts at Fitch also warned that recent loss experience may lead some underwriters to more cautiously extend coverage and larger loss limits going forward, and utilise tighter policy terms, including coverage sublimits and exclusions.

Cyber remains a fairly modest portion of premium risk for the industry and individual insurers.

However, underwriters face significant uncertainty in 0 measuring risk aggregations and potential losses from severe cyber disaster events.

Cyber risk modelling products remain in early stages of development compared with more established…