Cyber rates climb, D&O market gets capital: USI
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Rates for cyber insurance continued to climb, while the directors and officers market has gotten some needed capital, according to a report Friday from USI Insurance Services Inc.
USI now sees cyber coverage as up 60% or more for optimal risks and 100% or more for less optimal risks, optimal risks and challenged risks in the first half of 2022, compared with up 40% to 50% for optimal risks and 50% to 100% or more for less optimal risks at the end of 2021.
In addition to the continued rate increases, USI also noted “more technical and focused underwriting” in the cyber market. “The dramatic increase in ransomware attacks has prompted insurance companies to tighten the terms and availability of certain cyber coverages, especially for organizations that cannot demonstrate strong cyber risk controls and overall cyber hygiene,” USI said.
For D&O coverage, USI said rates continued to stabilize in the first half of 2022, with “abundant” capacity for excess D&O liability leading some programs to see overall decreases in premium.
Private company and not-for-profit D&O showed as up 5% to 25% at the end of 2021, moving to flat to up 15% in first-half 2022. Public company D&O coverage showed as down 5% to up 25% at year-end 2021, moving to flat to up 15% for primary coverage and down 10% to up 5% for excess coverage, yielding a total of down 5% to up 10% in first-half 2022.
Many other lines across the property and casualty spectrum showed similar 10% to 30% increases during the first half of 2022, similar to year-end 2021.
Medical malpractice showed some softening from up 10% to 35% at year-end 2021 to up 5% to 20% in first-half 2022. Professional liability and errors and omissions insurance also saw some softening, from up 10% to 50% at year-end 2021 to 10% to 35% in first-half 2022.
