Global Cybersecurity Insurance Market By Component (Solutions, Services), By Insurance Coverage (Data Breaches, Cybersecurity Liability), Insurance Type (Packaged, Stand-alone), Organization Size (Large Enterprises, SMEs), End User (Technology Providers, Insurance Providers), By Region, and Key Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends and Forecast 2021-2031

Cybersecurity insurance, often known as cyber liability insurance or cyber insurance, is a contract that a firm can buy to assist in mitigating financial risks of conducting business online. The insurance policy transfers some risk to the insurer in exchange for a monthly or quarterly premium. Cybersecurity insurance is a very new and untapped market. Given the dynamic and fickle nature of linked cyber-risks, cybersecurity policies can alter from month to month, of which, the buyers of cybersecurity services are liable for.

Underwriters of cybersecurity insurance policies, unlike well-established insurance plans, have little data to construct risk models to calculate insurance policy coverages, rates, and premiums. Errors and Omissions (E&O) insurance, a separate type of insurance that protects against flaws and irregularities in a given company’s services. This is where cyber insurance got its initiation. For enterprises that offer physical or digital products, E&O insurance is similar to product liability insurance.

While some cyber insurance policies include E&O coverage, the majority of providers sell these as separate policies. Customers who require such protection can acquire a cyber insurance policy. E&O insurance does not cover the loss of third-party data, such as consumer credit card numbers, etc.

Several of the same companies that sell relevant business insurance, such as E&O insurance, business liability insurance, and commercial property insurance, also sell cybersecurity insurance. Most plans contain first-party coverage for losses that directly affect a firm, as well as third-party coverage for losses incurred by others as a result of a cyber event or incident, depending on their commercial relationship with that company.

Cyber insurance policies assist in the coverage of financial damages caused by cyber events or incidents. Furthermore, cyber-risk coverage assists with the costs of cleanup, such as legal support, investigators, crisis communicators, and customer credits or refunds.

Detailed Segmentation –

Global cybersecurity insurance market is segmented on the basis of – Component, Insurance Coverage, Insurance Type, Organization Size, End User, and Region. Represented below is a detailed segmental description:

Based on Component:

• Solutions
• Services

Based on Insurance Coverage:

• Data Breaches
• Cybersecurity Liability

Based on Insurance Type:

• Packaged
• Stand-alone

Based on Organization Size:

• Large Enterprises
• SMEs

Based on End User:

• Technology Providers
• Insurance Providers

Based on Region

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Market Dynamics –

Numerous steps have been taken by respective government regulatory bodies and law enforcement agencies around the world to improve data security and protection. Policyholders, brokers, insurers, and agents have all acknowledged the need for cybersecurity insurance coverage. For example, in February 2020, all state contractors who process regulated and protected personal information must have cybersecurity insurance, according to a bill presented in California’s House of Representatives legislature.

The increase of data privacy laws in the United States, such as the Personally Identifiable Information (PII) Act and the Health Insurance Portability and Accountability Act (HIPAA), as well as the Payment Card Industry Data Security Standard (PCI DSS), and the European Union’s (EU) General Data Protection Regulation (GDPR), are persuading insurance providers to prioritize cybersecurity insurance measures.

Cyberattacks have increased dramatically as a result of increased digitalization levels, particularly during the COVID-19 pandemic. As a result, complicated data security governance standards and laws are projected to increase the adoption of cybersecurity insurance in the future.

One of the primary challenges impeding the expansion of the cybersecurity insurance market is the high cost of coverage. Over the past few years, insurance firms have had to pay out large claims as a result of ransomware assaults. Even if the ransom is not covered by cybersecurity insurance, the expense of restoring the hacked system is substantial.

Cybersecurity insurance providers are raising premiums to cover the increased expenses of additional services like negotiating with hackers and data recovery support during a ransomware assault. The increasing costs of cybersecurity insurance have hindered it adoption levels since businesses are more concerned with improving cybersecurity rather than paying higher insurance premiums.

 Competitive Landscape –

Some of the key players in this market are –

• BitSight
• Prevalent Inc.
• RedSeal
• SecurityScorecard
• Cyber Indemnity Solutions
• Cisco UpGuard
• Microsoft
• Check Point
• AttackIQ
• SentinelOne
• Broadcom
• Accenture
• Kenna Security
• Cylance
• FireEye
• CyberArk
• CYE
• SecurIT360
• Founder Shield
• others

Key developments –

2020:

• In July 2020, The Third-Party Risk Management Platform from Prevalent Inc. has been updated. Vendor Threat Monitor (VTM) business risk intelligence sources were added to the improved product to help organizations discover and mitigate risks in real-time. Machine learning is used in this improved platform to identify company risks and recommend remedial measures over time.
• In June 2020, BitSight for Third-Party Risk Management product created by BitSight, now includes new features. The improved solutions would allow third-party cyber risk management to give intelligent recommendations, manage risk, and improve operational efficiencies throughout extended business ecosystems.

For the Cybersecurity Insurance Market research study, the following years have been considered to estimate the market size: