Cyber risks have become a severe threat and persistent business risk for the global economy. The World Economic Forum (WEF) recognizes cyber risks as a potential global threat. It is identified as a top 10 risk in terms of likelihood as well as impact, among other risk categories such as economic, geopolitical and environmental. Additionally, the Allianz Risk Barometer 2015 ranks cyber risk as one of the top five risks for businesses globally, in particular for the insurance industry, climbing up from 8th in 2014 and 15th in 2013. The rising number and cost of cyber security incidents are placing a significant cost upon the global economy.
The global financial impact of cyber crime to businesses and organizations is estimated to range between US$375 billion to US$575 billion, according to a study by the Center for Strategic and International Studies (CSIS) in 2014. Cyber incidents from every industry across the globe have made headlines in the last five years, tarnishing the reputation of organizations and resulting in lost revenues. For developed economies, the impact of cyber crisis can be even more severe as cyber crime affects the unemployment rate. Over 150,000 people in Europe and 200,000 in the US lost their jobs due to the financial losses caused by cyber crime, according to CSIS.
The cyber risk insurance market has immense growth potential as businesses become more aware of the importance of protecting themselves from the costs of cyber attacks. This is reflected by cyber risk insurance purchases increasing five-fold during the period 2006 to 2013, according to Advisen's cyber insurance buyer penetration index. Total global losses due to cybercrime stand at US$445 billion according to the CSIS in June 2014.
The Insight Report: The Future of Cyber Risk Insurance market research provides a detailed study of the state of the cyber insurance market globally. As well as insights into key trends regarding market size, there is detail on growth, premium pricing and claims payout. Moreover, the report contains analysis of market opportunities and challenges faced by insurance companies in marketing and selling cyber risk insurance products. In addition there is an assessment of insurance as a tool in mitigating cyber risk. The report also analyzes the role of insurance as a strategic tool in organizations' cyber risk management.
Transferring risk in exchange of a premium makes commercial sense for businesses and organizations. As part of cyber risk insurance, several insurers provide value-added services such as access to a specialist lawyer, IT forensics experts and crisis management in the event of a data breach. This further makes cyber-insurance products more attractive, and also increases the value of the product to customers. Businesses are increasingly purchasing standalone cyber risk insurance policies to cover the specific cyber risks. Standalone cyber risk insurance policies fulfill the limitation of traditional policies by providing insurance cover for specific risks in a cyber environment. It includes the cost of security or data breach such as notification expenses, regulatory fines and penalties, investigation and restoration cost.
Insurers are collaborating with cyber security experts to provide robust cyber risk management to the businesses and organizations. The cyber insurance market has the ability to offer solutions that cover a broad range of cyber risks; however, there are certain caveats. Risks faced by the firms tend to be unique to the industry in which they operate, and this requires the policy to be accordingly customized. Table of Contents and more on this research is available at http://marketreportsstore.com/toc/?rname=37924 .
Market Reports Store is your one-stop online shop for syndicated industry research reports on 25+ categories and their sub-sectors. We bring to you to the latest in market research across multiple industries and geographies from leading research publishers across the globe.