We hosted our Projecting Cyber Insurance Growth Webinar on Thursday, October 10, at 4:00 PM GMT.
The property and casualty (P&C) insurance sector is on the brink of a transformative opportunity to establish a sustainable market for cyber risk transfer—crucial for bolstering societal resilience against one of the most significant economic threats of the time.
During the webinar, CyberCube's experts discussed insights from our latest report, “Projecting Cyber Insurance Growth: A 10-Year US Market Outlook,” where we applied our industry-leading analytics to forecast U.S. standalone cyber market growth over the next decade, from 2024 to 2034. We stress-tested premium growth projections, analyzed the capital requirements needed to support this expanding line of business, and explored the structural changes necessary to meet these ambitious targets.
Topics we covered included:
- Rapid Growth Projections: Cyber insurance is projected to grow rapidly, driven by increasing digitization of the global economy and rising concerns about cyber risk. CyberCube has modeled three Compound Annual Growth Rates (CAGR) for the US insurance industry to 2034: Our mid-point, 20% CAGR, would result in $45 bn of US cyber premium in 2023 dollars. CyberCube’s US Industry Exposure Database (IED) pegs US standalone premium in 2023 at $8 bn.
- Cyber as a Peak Peril: Cyber will become a peak peril, with the potential for losses from US Standalone Cyber to exceed Hurricane Katrina in 2005 — the largest insurable natural catastrophe to date, costing the (re)insurance industry $102 bn in 2023 dollars. At 20% CAGR, the amount of capital required to manage to a 1-in-250 year loss would be $121 bn.
- Capital Requirements: The cyber (re)insurance market will need to substantially increase capital to enable this growth potential, with increases needed from multiple sources including insurers, reinsurers, capital markets, and potentially private-public partnerships.