How to close the cyber insurance data gapBy Eduard Alpin | February 3, 2020
With a 78 percent spike in global supply chain attacks and a 56 percent increase in malicious web attacks in the United States since 2018, it’s little surprise that businesses are turning to cyber insurance to transfer the risk of operating in today’s threat-laden cyberspace.1
The numbers don’t lie. According to a recent report, direct written premiums for stand-alone and packaged cyber policies in the United States grew roughly 12 percent in 2018 from $1.8 billion to $2 billion.2 More insurers have entered the market as well. In 2015, the same report noted that 309 insurers were writing cyber coverage. By 2018, that number had ballooned to 528.
New data for a new era of risk
While there’s been a surge of interest and activity around cyber insurance, it remains difficult to access reliable sources of broad-based, relevant data.3 Indeed, in a survey conducted by Verisk at the 2018 Casualty Actuarial Society annual meeting, “data and analytics” were cited among the top challenges facing the industry with respect to cyber insurance.4
The data deficit could present an existential risk to insurers and professionals operating in this market, as it may touch on nearly every facet of their business: what decisions they should make about their portfolios and individual policies and even which coverages they can confidently offer.
Verisk’s Cyber Data Exchange was built to address this challenge. The Cyber Data Exchange aggregates cyber data from across the industry and provides summarized business intelligence back to participating companies through interactive dashboards.
By aggregating anonymized industrywide cyber data and delivering actionable metrics and insights, the Cyber Data Exchange provides information that can help cyber insurers benchmark their portfolios, better understand which segments of business are most profitable, and enhance their internal analytics. As the dollar value of cyber premiums is anticipated to grow, this data aggregation can provide an invaluable source of business intelligence, including loss severity, claims frequency, and average premium data for participating insurers.
To learn more about how you can participate in the Verisk Cyber Data Exchange and unlock the power of cyber data, please contact us at email@example.com.
- The Internet Security Threat Report, Volume 24, Symantec, February 2019, < https://www.symantec.com/content/dam/symantec/docs/reports/istr-24-2019-en.pdf >, accessed on January 29, 2020.
- Cyber Insurers Are Profitable Today, but Wary of Tomorrow’s Risks, M. Best, June 17, 2019, < https://reaction.ambest.com/reaction/emsdocuments/Special%20Reports/2019/2019.06_Cyber_Insurance_Report.pdf >, accessed on January 29, 2020.
- Jim Lynch, “Cyber Insurance: Growth and Challenges,” Actuarial Review, September 13, 2017, < https://ar.casact.org/cyber-insurance-growth-and-challenges/ >, accessed on January 29, 2020.
- What is the biggest challenge that still faces the cyber insurance industry? Verisk/Casualty Actuarial Society, 2018, < https://www.verisk.com/insurance/products/cyber-data-exchange/ >, accessed on January 29, 2020.