Price hikes forecast for E&O, cyber cover in H1: Aon

Most insurers plan significant rate increases for errors and omissions and cyber coverage during this year’s first half, says Aon PLC in a report issued Tuesday.

“We expect this to be comparable to the second half of 2021, but anticipate potential stabilization in the second half of 2022,” according to the report, “2022 Errors & Omissions and Cyber Market Review.”

The report said also the broker anticipates all insurers offering cyber and E&O insurance “to continue to bring new scrutiny, applications and underwriting questions into the placement process. It says it anticipates a focus on war exclusions and “infrastructure language” in cyber policies.

“Insurers continue to face challenges in specific industry verticals,” the report says, particularly public sector, health care, manufacturing and higher education, and across small to mid-sized companies.

The report says also there was a slight reduction in cyber claim frequency throughout 2021, although claims have risen dramatically since 2018, while E&O media liability claims remained consistent.

Ransomware activity, however, was up 323% for first-quarter 2019 to fourth-quarter 2021, and eight-figure losses are commonplace, with business interruption representing the largest component of loss and litigation still to come.

“Rates accelerated throughout the year, and we expect this trend to continue as we head deeper into 2022,” according to the report.