Washington, D.C. (Oct. 31, 2016) – The Council of Insurance Agents & Brokers has released the findings of its third semi-annual Cyber Insurance Market Watch Survey. Eighty-eight (88) respondents from 66 unique firms participated in the survey and provided insights on all aspects of the cyber insurance market from take-up, to premiums and sophistication of their clients’ cybersecurity programs.
“Now in its third iteration, this survey is showing several trends developing in the cyber insurance market,” said Ken A. Crerar, President/CEO of The Council. “We received more robust responses to this survey than either of our previous cyber surveys because more of our members are engaging in this market and engaging at more sophisticated levels than they were even a year ago.”
Roughly 29 percent of respondents’ clients purchased some form of cyber liability and/or data breach coverage in the last six months. This was an increase of four percent since April 2016. Of those policyholders who purchased cyber coverage in the last six months, nearly 40 percent increased their coverage levels. One broker from Texas explained that this was “mainly due to increase[d] and or improved coverage provided by the market as compared to last renewal.”
Results also indicated some levels of price stabilization, at least in certain sectors, as nearly 72 percent of respondents said rates stayed roughly the same over the past six months.
Respondents felt there was adequate capacity for most of their clients’ needs, citing difficulties for the largest clients; those in the most highly-targeted industries such as healthcare; and for clients who have already had a cyber claim. One broker from Indiana explained that capacity is generally adequate, “but if there have been claims, those are very difficult. They have always been difficult but I think accounts with claims are getting tougher to place.”
Purchasing decisions once again varied from large to small and medium-sized organizations. Large accounts tend to purchase cyber coverage for the risk transfer benefits, while small and medium-sized organizations also heavily considered contract compliance and post-breach response resources in their decision to purchase cyber coverage.
“As our broker members are investing more in resources to educate themselves and their producers about cyber risk, they are passing this knowledge on to their clients who are making better, more informed decisions about their cyber exposure and cyber insurance needs,” said Crerar. “This is exactly the role of the broker and we see a lot of growth potential in this market for our members.”
The Council developed and launched its first Cyber Insurance Market Watch Survey one year ago in order to gather a baseline reading of the cyber insurance market. It continues to monitor the market as it develops.
The Council of Insurance Agents & Brokers is the premier association for the top regional, national and international commercial insurance and employee benefits intermediaries worldwide. Council members are market leaders who annually place 85 percent of U.S. commercial property/casualty insurance premiums and administer billions of dollars in employee benefits accounts. With expansive international reach, The Council fosters industry wide relationships around the globe by engaging lawmakers, regulators and stakeholders to promote the interests of its members and the valuable role they play in the mitigation of risk for their clients. Founded in 1913, The Council is based in Washington, D.C.
SOURCE: Council of Insurance Agents & BrokersTags: Council of Insurance Agents & Brokers (CIAB)