GAO ‘Government Accountability Office’ in the U.S highlighted the skyrocketing cost of cyber insurance in the latest statement imposing challenges faced by the individual market in relieving cyberattacks.
Thursday published in its study, the firm declared that according to enterprise sources, rates have arisen. It also summoned a current insurance broker survey, which found that premiums for more than half of customers rose by 20% to 30% in late 2020.
“After enduring comparatively steady in 2017 and 2018, cyber insurance premiums rose particularly in 2020,” the agency stated in its statement.
“Higher costs for cyber insurance have concurred with increased interest for the product and higher insurer losses from increasingly frequent and critical cyberattacks (especially ransomware attacks that block users from accessing systems or data until a ransom is paid).”
The U.S GAO ‘Government Accountability Office’ has analyzed the private cyber insurance market in acknowledgment to new requirements included in the National Defense Authorization Act for the economic year 2021.
Most candidly listed firms purchase standalone cyber coverage as a role of their risk management operations, as do some public sector objects such as state governments and agencies.
The statement found also that insurers are granting cheaper coverage purposes, and remarked that insurance companies have limited historical data on most losses.
Insurance firms are allowing cheaper coverage purposes and frequently encouraging customers to purchase specific, standalone cyber policies. Earlier, many insurers have tried cyber coverage as an optional add-on to other types of policies, such as property insurance.
This has generated aggregation risk for the insurance market, which is identified as “silent cyber.”
According to GAO, the language utilized in cyber policies also often lacks basic definitions.
Cyber insurance firms’ hunger for writing policies for public sector entities has refused extensively in recent months, following the slaughter of high-profile attacks, including attacks against Texas’ Department of Transportation and state court system.
