Long gone are the days of five-question cyber insurance applications, low premiums, and too many cyber insurance options to choose from.
If your company has just renewed a cyber insurance policy, there were certainly many surprises that made the renewal process much more difficult this year. Longer renewal applications and supplemental ransomware applications needed to be completed. Security requirements needed to be addressed and implemented. Perhaps you were one of those companies that had a cyber insurance policy non-renewal being that you no longer align with an insurer’s risk criteria. The most dreaded part of the cyber insurance renewal process this year is the significant premium increases which keep on increasing with no end in sight. In addition, for those companies that are required to maintain high cyber liability limits, it was very likely you had a difficult time getting excess cyber liability limits due to the low capacity that is occurring in the marketplace due to underwriter’s curbed risk appetite.
Indeed, there are also surprises in store for those companies that have opted to hold off purchasing cyber insurance because they thought it was too expensive last year, only to learn it is twice as expensive (in some cases 400x more expensive) now.
It has become a cyber insurance nightmare for many companies, and many insurers.
For those of us who have been involved in cyber insurance for quite some time, we knew this time would come but never anticipated the cyber insurance market capacity would dissolve this quickly.
For the past five years or so, insurers were giving cyber insurance policies away for pennies. Today, insurers are very hesitant in providing cyber insurance quotes when underwriting a new company, and have significantly increased their premiums while providing less coverage, lower liability limits and higher deductibles or coinsurance.
While there are still many insurers today that continue to provide cyber insurance, there are fewer options to choose from being that companies exploring cyber insurance for the first time, or renewing an existing policy are either being declined, or forced to pay significant cyber insurance premiums. This makes the cyber insurance process much more difficult to navigate.
If you’re a company tackling the cyber insurance conundrum, you absolutely need a highly experienced cyber insurance broker to help your company through this challenging market.