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Sustainable cyber insurance markets

 

25/02/2020 - In an era of increasing reliance on digital technologies – and the growing exposure to cyber risks that accompany that reliance – cyber risk insurance can make an important contribution to providing financial protection and helping policyholders prevent and respond to cyber incidents. This summary shares some of the findings from two examinations on the role of public policy and regulation in supporting the development of a sustainable cyber insurance market. 

 

In recent years, an insurance market for cyber risks has emerged to provide financial protection (mostly to businesses) for some of the digital security and privacy risks that have accompanied the growing use of data and digital technologies. While growing quickly – with some estimates suggesting that the market will double or triple in size in the next few years – the market remains small relative to other lines of commercial insurance business. A lack of understanding of cyber exposure, limited data on past incidents, misunderstandings about when cyber risk is covered in a given insurance policy and what types of exclusions might apply along with a significant (and difficult to quantify) exposure to accumulation risk have all contributed to caution among insurance companies in extending coverage and reluctance among policyholders to acquire this coverage.

 

Encouraging Clarity in Cyber Insurance Coverage

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Enhancing the Availability of Data for Cyber Insurance Underwriting

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Encouraging Clarity in Cyber Insurance Coverage

Enhancing the Availability of Data for Cyber Insurance Underwriting

 

 

 

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