IndustryARC updated the market research study on “ Cyber Insurance Market”- Forecast (2024 - 2030)

Cyber Insurance Market size is estimated to reach US$51.5 billion by 2030, growing at a CAGR of 27.3% during the forecast period 2024-2030. Increasing Cyber Threat Landscape and Digital Transformation and Increased Dependency on Technology are expected to propel the growth of Cyber Insurance Market.

Additionally, the cyber insurance market continues to experience significant growth in demand driven by escalating cyber threats and increased awareness of cybersecurity risks among businesses worldwide. Factors such as the proliferation of remote work arrangements, the expansion of cloud computing, and the rising sophistication of cyber-attacks contribute to the heightened demand for cyber insurance. Cyber insurance providers are expanding their coverage offerings and providing more customized solutions to meet the evolving needs of businesses across various industries. Insurers are enhancing their policies to address emerging cyber risks, such as social engineering fraud, supply chain vulnerabilities, and cyber-attacks targeting Internet of Things (IoT) devices.

For More Details on This Report - Request for Sample

COVID-19 / Ukraine Crisis - Impact Analysis: ?

• During the COVID-19 pandemic, the cyber insurance market experienced a notable impact as businesses rapidly transitioned to remote work environments, increasing their reliance on digital infrastructure and heightening the risk of cyber threats. With the surge in cyber-attacks targeting remote workers and vulnerable systems, demand for cyber insurance surged as businesses sought to bolster their cyber resilience and protect against potential financial losses and liabilities. Additionally, the pandemic-induced economic uncertainty prompted many organizations to reevaluate their risk management strategies, leading to greater awareness of cyber risks and the importance of cyber insurance coverage.?
• The conflict in Ukraine also had repercussions on the cyber insurance market, albeit to a lesser extent compared to the pandemic. Heightened geopolitical tensions and cyber warfare activities raised concerns about the potential for state-sponsored cyber-attacks targeting businesses and critical infrastructure globally. Businesses operating in regions directly affected by the conflict, such as Ukraine and neighboring countries, have experienced increased demand for cyber insurance as they sought to mitigate the heightened risk of cyber-attacks and data breaches amid the geopolitical instability.?

Key Takeaways:

• North America Dominated the Market

Geographically, in the Cyber Insurance market share, the North America region is analyzed to hold a dominant market share of 36% in 2023, The region's advanced technological infrastructure, extensive digitalization across industries, and high awareness of cybersecurity risks among businesses have fueled the significant uptake of cyber insurance policies. Additionally, stringent regulatory frameworks such as the GDPR in Europe and various data breach notification laws in the United States have compelled organizations to invest in cyber insurance to mitigate financial liabilities and regulatory penalties associated with data breaches. Furthermore, the prevalence of high-profile cyber incidents and the escalating frequency and sophistication of cyber threats have underscored the critical need for comprehensive cyber insurance coverage in North America.

• Third Party Coverage is the fastest growing segment

In the Cyber Insurance Market forecast, Third Party Coverage segment is estimated to grow with a CAGR of 32.2% during the forecast period, With the increasing frequency and sophistication of cyber-attacks, businesses are facing heightened exposure to legal and financial liabilities arising from breaches of sensitive data and the impact on third parties. As a result, there is a growing recognition among organizations of the importance of protecting themselves against third-party claims and lawsuits related to cyber incidents. Third-party coverage provides businesses with financial protection and peace of mind by indemnifying them against the costs of legal defense, settlements, and judgments associated with third-party claims for damages resulting from data breaches, network security failures, and other cyber-related liabilities. Additionally, regulatory mandates such as the GDPR and CCPA impose strict requirements for businesses to safeguard personal data and notify affected individuals in the event of a data breach, further driving the demand for third-party coverage. ?

• ?BFSI to Hold Largest Market Share

According to the Cyber Insurance Market analysis, the BFSI is estimated to hold the largest market share of 29% in 2023, due to its heightened exposure to cyber risks and regulatory requirements. Financial institutions, including banks, investment firms, and insurance companies, handle vast amounts of sensitive customer data and financial transactions, making them prime targets for cyber-attacks and data breaches. Largest DDoS attack ever recorded against Google, DDoS attack attempt on Google, which peaked at an unprecedented 398 million requests per second but ultimately failed. In India 2023, the Thane Police have exposed a massive cyber heist, with cybercriminals pilfering an astonishing ?16,180 crore ($19.4 billion). This unprecedented cyber-attack involved the breach of a payment gateway company's account, leading to the unauthorized siphoning of funds from various bank accounts. The role of cyber insurance may come into the picture only after a cyber breach, but it remains an essential element in an organization's management and risk mitigation strategy. As a result, BFSI firms prioritize cyber risk management and invest heavily in cyber insurance to mitigate financial losses, protect their reputation, and comply with regulatory mandates.

• Increasing Cyber Threat Landscape

The proliferation of cyber threats, including sophisticated cyber-attacks, data breaches, ransomware, and other forms of cybercrime, continues to drive the demand for cyber insurance. One in every two Indians is an active internet user as per a report from the Internet & Mobile Association of India in 2022. As businesses go digital, their online exposure is increasing and with that, the threat of cyber- attacks and data breaches looms large. A cybersecurity report by Checkpoint in 2023 suggests that global cyberattacks increased by 38% in 2022. The FBI Internet Crime Report 2022 ranks India at #4 behind the US, UK and Canada, in terms of total cybercrime victims. As businesses increasingly rely on digital technologies and data-driven processes, they become more vulnerable to cyber-attacks. As a result, rise in number of cyber-attacks and security breaches across the industry will drive the growth of cyber insurance in the forecast period.

• Digital Transformation and Increased Dependency on Technology

The ongoing digital transformation across industries, accelerated by factors such as remote work arrangements and the adoption of cloud-based services, has led to an increased reliance on technology and digital infrastructure. As businesses digitize their operations, they become more susceptible to cyber risks, including data breaches, ransomware attacks, and other cyber threats. This heightened vulnerability drives the demand for cyber insurance as organizations seek financial protection against potential cyber incidents that could disrupt operations, compromise sensitive data, and result in significant financial losses. Additionally, the expansion of Internet of Things (IoT) devices and interconnected systems further amplifies the need for comprehensive cyber insurance coverage to address the evolving cyber risk landscape.

• High Cyber Insurance Costs

While the demand for cyber insurance continues to rise amidst escalating cyber threats, insurers face challenges in accurately assessing and pricing cyber risks due to the evolving nature of cyber threats, lack of historical data, and the potential for catastrophic losses. As a result, premiums for cyber insurance policies can be prohibitively expensive, especially for organizations with complex IT infrastructures and high exposure to cyber risks. For instance, under the Digital Personal Data Protection Act, 2023, which proposes fines of up to INR 250 crore ($30.12 million) for failing to take reasonable security safeguards to prevent a personal data breach. Such strict regulatory measures are expected to encourage companies to view cyber insurance as a risk management investment rather than a "cost".

Schedule a Call with IndustryARC Market Research Executive

Key Market Players:?

Product/Service launches, approvals, patents and events, acquisitions, partnerships and collaborations are key strategies adopted by players in the Cyber Insurance Market. The top 10 companies in this industry are listed below:

1. Axa XL
2. Zurich Insurance Group Ltd.
3. American International Group, Inc.
4. CNA Financial Corporation
5. BCS Financial Corporation
6. Chubb Limited
7. Allianz SE
8. Citigroup Inc.
9. Axis Capital Holdings Ltd.
10. HDFC Bank Ltd.