Cyber insurance has been around for decades. And while more companies are looking for insurance against attacks, insurers are taking steps to limit their exposure to losses, impacting pricing and coverage. Read this WatchBlog post from the GAO on how rising cyberthreats are impacting the insurance market.
Cyber insurance is designed to cover common losses related to cyber incidents, such as data breaches and ransomware attacks that can lead to business disruptions. It has been available for about 20 years and aims to help organizations mitigate financial damages from cyber threats.
Why are cyber insurance premiums increasing?
Cyber insurance premiums are increasing due to a combination of rising demand for coverage and the growing frequency and severity of cyberattacks. Between 2016 and 2019, the costs associated with cyberattacks nearly doubled, prompting insurers to raise premiums and limit coverage options, particularly for higher-risk sectors.
How is the federal government involved in cyber insurance?
The federal government, through entities like the Federal Insurance Office and the Cybersecurity and Infrastructure Security Agency (CISA), is assessing the financial implications of increasing cybersecurity risks. However, there has yet to be a comprehensive evaluation of the federal role in response to catastrophic cyber incidents, which could inform potential insurance responses.
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