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FOR IMMEDIATE RELEASE
OLDWICK - MARCH 04, 2025 09:25 AM (EST)
A recent AM Best survey of insurance companies offering cyber liability coverage found that the majority of limits are covering businesses with less than $10 million in annual revenue, highlighting the fact that these small-to-midsize enterprises bring the most exposure.
AM Best received responses from nearly 70% of the 60 largest cyber insurers globally, representing approximately $8 billion in premium, or approximately half of estimated global cyber premium. As stated in the Best’s Commentary, “Cyber Insurance Survey Highlights Systemic Risk, Particularly on SMEs,” the systemic risk of cyber puts an emphasis on aggregate exposure for insurers. While larger companies tend to be the targets of cyber attackers due to their wealth and vast customer data stored, small businesses account for over 80% of all cyber policies.
“The survey results highlight the systemic risk of cyber insurance. To the extent that any of these small businesses could be using the same cloud service or another common service illustrates how one outage or attack could impact several policies,” said Christopher Graham, senior industry research analyst, AM Best.
Ransomware, with its quick payouts to the threat actors has become the most common claim, and the survey results showed that among reported claims for a specific coverage, more than half were for “incident response,” which would include ransomware attacks and business email compromise.
“While many insureds have been able to avoid paying ransom, those that haven’t ultimately may endure more losses owing to business interruption than the cost of the ransom,” said Bryan Raber, associate analyst, AM Best. “On a per-claim basis, business interruption claims are more expensive than incident response claims, encompassing 25% of total net incurred losses among the survey population, compared with 14% on the business interruption side.”
To access the full copy of this commentary, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=351765.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.