Insurance markets can be unpredictable and complicated. Many different factors can affect market trends. It’s important for Exe Insurance policyholders to be aware of these patterns.
Across industry lines, cyber-attacks have surged in frequency and sophistication, resulting in a rise in cyber-losses.
In recent market conditions, we predict that most policyholders will experience higher cyber-liability insurance rates this year. According to Finaria, the global cyber-insurance market is expected to grow to a value of £6.83 billion in 2021. This would represent a 21 per cent increase compared to 2020.
These projections can be largely attributed to greater awareness and understanding of potential cyber-threats. The rising frequency of remote work during the coronavirus pandemic has made such cover particularly important for both organisations and individuals.
Cyber- Liability Patterns
Push for standalone policies
Amidst growing cyber-risks, most standard property and liability policies have exclusions for cyber-exposures to avoid unexpected losses. As such, it’s critical for organisations that don’t already have a standalone cyberliability policy to seriously consider securing one.
Remote work exposure
The pandemic forced many organisations to have their staff work from home for the first time. Unfortunately, these telework arrangements led to a rise in cyber-attacks, as many cyber-criminals targeted remote employees in various phishing incidents. Additionally, many cyber-risks—such as issues related to business email compromise (BEC) incident have emerged or become more prevalent due to remote work.
Ransomware concerns
Ransomware is any type of malicious software that infects a computer and either prevents it from working as it should or prevents access to certain files until the user pays a ransom. The number of ransomware attacks has spiked in the past few years. Organisations should be particularly wary of double-extortion ransomware, which may result in cyber-criminals not only compromising systems, but also threatening to release sensitive information to the public. In response to this rising threat, some insurance carriers have revised cover related to ransomware incidents.
Regulatory ramifications
A multitude of international and domestic jurisdictions have recently debuted new data protection laws aimed at increasing responsibilities and compliance considerations for organisations that handle sensitive data.
New technologies
Many employers have had to rely more on technology during the pandemic. New technology can help make operations easier and more efficient, but they can also result in additional cyber-risks.
If your business is targeted by a hacker or suffers a data breach, it takes time and money to fix. This can disrupt your business, lead to lost revenue, a damaged reputation and regulatory fines.
Cyber liability cover varies widely from policy to policy but can include the following:
- Data issues (loss, theft or corruption)
- Identification and containment of system issues
- Regulatory requirements following data breach
- Defamation issues following outside interference in systems
- Financial losses caused by the failure of your company website, the collapse of your internet provider or the work of computer hackers
- Public relations consultancy to address and contain reputational damage
Cyber insurance can not only help businesses by providing a financial pay-out after things have gone wrong, but also offering expert consultancy to improve security and on-the-ground support during the period of crisis.
Cyber risk is a current and critical issue and we would be happy to talk through the cover that you may need so that you can be sure that you are fully protected. Get in touch with us for a chat on 01392 797733 or email sales@exe-insurance.co.uk.
