Market update – Cyber Liability Insurance
Significant and well publicised events such as PayID, Government agencies and Toll have seen more businesses become cyber aware. Industry data suggests that the cost to business from cyber incidents in 2020 was over $30 billion. It is estimated that Australian business will spend more than $7.5 billion on cyber security for the calendar year in 2021.
Losses to insurers have continued to escalate, however premium rates and breadth of cover continues to remain reasonable. We expect uplifts of 10-20% on renewal of policies. That said, we emphasise to all of our clients the importance of being cyber “prepared”. Directors should engage the services of external providers to assess their situation and what improvements they could make to network infrastructure and response planning.
Claims by frequency of notification are: ransomware (26%), data breach by hackers (12%), Impersonation fraud (11%), data breach due to employee mistake/negligence (9%). Claim quantum varies by industry size, however in the large private to small listed public company space claims have ranged from $3,250 to $5.2m. Claims that we have dealt with in cyber average out at $198,896 and involve mostly ransomware and imitation fraud.
Losses to insurers have continued to escalate, however premium rates and breadth of cover continues to remain reasonable. We expect uplifts of 10-20% on renewal of policies. That said, we emphasise to all of our clients the importance of being cyber “prepared”. Directors should engage the services of external providers to assess their situation and what improvements they could make to network infrastructure and response planning.
Claims by frequency of notification are: ransomware (26%), data breach by hackers (12%), Impersonation fraud (11%), data breach due to employee mistake/negligence (9%). Claim quantum varies by industry size, however in the large private to small listed public company space claims have ranged from $3,250 to $5.2m. Claims that we have dealt with in cyber average out at $198,896 and involve mostly ransomware and imitation fraud.
