Cyber insurance premiums soar: RPS
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Industries hardest hit by cybercrime have seen premium increases as high as 300% at renewal, Risk Placement Services Inc., a unit of Arthur J. Gallagher & Co., said in a report Monday.
Even with the right cybersecurity controls in place, organizations are finding it impossible to secure 2021 coverage at 2020 rates, RPS said in its U.S. Cyber Insurance Market Outlook report.
Companies and organizations in education, public entity/government, health care, construction and manufacturing are among those taking the brunt of price increases, according to the report.
Insurers are “strategically” increasing premiums and lowering coverage limits for those industry classes, RPS said.
Capacity restrictions that took hold in 2020 are also intensifying, the report said.
“Insurers that were more than eager to issue $5 million cyber liability policies in 2020 have scaled back to limits of $1-3 million, even on a renewal,” RPS said.
As a result, building a cyber liability coverage tower has become more challenging, requiring additional insurers to reach the desired limits.
“This year’s changes in capacity, underwriting standards and even increases in premium were a necessary evolution,” Steve Robinson, RPS national cyber practice leader, said in a statement. “Cyber insurance underwriting has become more reflective of today’s risks.”
