This insurance market is expected to grow to $20B in five years: Fitch Ratings
"Industry estimates suggest that the global cyber insurance business could increase to $20 billion by 2020, but the lack of information on cyber insurance is a challenge," said Fitch Ratings managing director James Auden in a recent report.
"Challenges in isolating cyber related premiums and exposures from other risks within a package policy create limitations in analyzing the supplemental filing as total cyber insurance premiums are likely understated," he added.
Fitch recently released a study that aims to measure the size of the cyber insurance market in the US, based on statutory reports.
Data from the broader property/casualty insurance segment revealed that around 120 underwriters reported providing a total of $1 billion worth of cyber coverage last year.
However, the growth comes with a caveat as carriers struggle to make heads or tails of the actual risk involved in this nascent segment. Direct P/C loss ratio specifically for cyber business stood at a hefty 65%, the report said.
"The ultimate profitability of the P/C industry's cyber insurance efforts will take some time to assess as the market matures and future cyber-related loss events emerge," Fitch Ratings director Gerry Glombicki also observed.
The Fitch report, U.S. Cyber Insurance Market Share and Performance, compiled company and industry statistics on cyber insurance. It can be accessed through www.fitchratings.com.