A GlobalData poll reveals that insurance insiders view cyber risk as the top threat, surpassing natural catastrophes and political risks. This highlights the risk of cyberattacks in today’s digital landscape and presents opportunities for insurers in cyberspace. Moreover, QBE has responded with a product launch that underscores insurers’ focus on cybersecurity products.
A GlobalData poll ran across Verdict Media’s insurance business websites found that over a third of respondents expect cyber risk will be the leading threat to the industry over the next three years. With an increasing number of cyberattacks taking place across the globe, and an increasingly integrated global IT supply chain, the risk of extreme losses from cyber incidents is rising. Such losses not only cause funding problems for businesses but may also put their solvency at risk. While the financial sector is uniquely exposed to cyber risk, given the large amounts of sensitive data it handles, incidents can spill over to other institutions and threaten the stability of wider economic systems.
Go deeper with GlobalData
As a result, QBE’s recent launch of its global cyber coverage is not only aimed at enhancing cyber resilience for large-scale corporations but also at providing coverage for SMEs, which remain an underserved segment of the market. According to GlobalData’s 2023 UK SME Insurance Survey, 52.5% of medium and 41.4% of small SMEs have adopted cyber insurance, whereas micro enterprises and sole traders lag behind at 20.1% and 11.3%, respectively. This shows a huge gap in the market and an opportunity for insurers to target businesses of all sizes.
According to the IMF, the number of cyberattacks has more than doubled since the pandemic. Heightened geopolitical tensions and greater digitalisation mean that the risks associated with a cyberattack have risen. Likewise, a report by GCHQ’s National Cyber Security Centre indicates that artificial intelligence will increase the volume and impact of cyberattacks over the next two years.
With the volume and severity of cyberattacks rising and much of the market uninsured, businesses will look to secure coverage for themselves. This presents a unique opportunity for insurers, who will seek to find the right balance between price and risk and exploit the gap presented by the cyber market.
In this context, QBE’s new initiative aimed at providing tailored coverage for losses arising from current and emerging cyber risks—as well as the recent launch of Cyber.IE by the CRC Group and INSUREtrust—is designed to provide protection and flexibility for businesses in need of cyber solutions, indicating that the market is responding to the increased cyber risk. Cyber presents a significant threat but also an opportunity for insurers. While cyberattacks are rising, so is demand for cyber insurance products, which is promoting innovation in this space.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataCyber risk remains a paramount challenge in the insurance industry, with potential coverage gaps for various sizes of SMEs emerging as a focal point for innovation. As the threat level evolves with the integration of AI in cyberattacks, the market can anticipate increased innovation to address these evolving risks. Notably, while larger SMEs dominate the adoption of cyber insurance, there exists a market opportunity among micro enterprises and sole trader SMEs, all of which are vulnerable to cyber threats.
