The soaring rates and constricting coverage in the cyber insurance market appear unlikely to ease for buyers any time soon. After the spate of severe ransomware attacks in the first half of 2021, Willis Re reported that global cyber reinsurance rates spiked by as much as 40% during July renewals. The surge in ransomware cases and growing ransom demands and recovery costs continue to result in large claims, taking an increasingly clear toll on insurers and reinsurers.
“Reinsurers that have been writing cyber are looking at considerably worse results than a few years ago,” James Vickers, chair of Willis Re, told Reuters. “I don’t think people had really imagined the extent of the ransomware attacks going on.” According to the firm’s report on reinsurance renewal trends, the cyber market has continually and rapidly hardened since the beginning of this year, and many carriers are actively looking to reduce their exposure to ransomware through either sublimits or coinsurance.