During the first half of 2024, the Asia cyber insurance market was generally a buyer’s market in most revenue and industry segments and we forecast this to continue into 2025.
Most segments of the cyber market benefited from notably improved rates and pricing driven by insurer competition and an influx of capacity. We have seen rate reductions of 10-30% or greater becoming commonplace. Purchasers have been leveraging these favourable market conditions to increase limits, maximising their existing budget allocated for their cyber insurance premium.
We have seen insurers showing a willingness to offer quotations with less granular underwriting information than in recent years; there is more convergence and alignment on the baseline controls insurers are looking for now.
Despite the softening market conditions, claims activity remains steady/rising. Global insurers reported an increase in ransomware frequency in excess of 50% throughout 2023 and into 2024.
We expect that in Q3-Q4 2024 we will continue to see softening as market competition develops. We continue to see abundant capacity for cyber placements in Asia, driving premium competition and keeping market rates favourable. Retentions are also trending downwards, despite the continued spate of ransomware attacks we are seeing in-region
If you have been considering purchasing cyber insurance but had held the perception that it was plagued with high premiums, it is an opportune time to purchase now with many insurers actively pursuing new business. It is a buyer’s market.
If you are an existing cyber insurance policyholder, you may wish to challenge your existing policy programme to see what improvements in terms of cost and coverage can be leveraged in the current market. Coverages which previously may have been on an ‘optional extension’ basis may now be included for nil or minimal additional premium: System Failure, Dependent System Failure and Contingent Business Interruption. Other coverage enhancements you may also request include Betterment costs and Bricking Costs (available on a sub-limited basis).
We recommend exploring broker proprietary wordings and facilities in this ‘softened’ marketplace – insurers are now more open to writing on broker wordings which tend to be far more favorable to the policyholder.
Source: WTW Global Cyber Benchmarking; data captured 10/07/2024
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