Technology and cybersecurity website, ITPortal, recently interviewed Geoff White from Lloyd’s of London about the growing need for cyber insurance as cyber-threats increase in both size and sophistication. The fact that that cyber insurance has reached an annual GWP of $2.5 is no surprise, explains White, because cyber coverage has transformed from an optional extra to an absolute necessity. Not only has cyber insurance grown in demand, but the types of cyber coverage available has evolved dramatically due to an “increased level of consultation between insurers, brokers and policyholders … facilitating a much greater understanding of potential exposures and enabling the development of cyber policies to help protect companies against the constantly changing nature of cyber threats.”
While the availability of cyber coverage has certainly been a major driver for growth, White believes that customer awareness has played the largest role in this dramatic increase. Due to the media’s coverage of large scale data breaches, such as Target and Anthem, the C-suite now understands the direct and hidden costs that can result from a breach – legal fees, damaged reputation, stolen intellectual property, business interruption, etc. Additionally, the demand for cyber coverage is not limited to large enterprises and organizations. Companies of all sizes across virtually all sectors have become interested in purchasing cyber insurance as they begin to understand that no organization, large or small, is insusceptible from a breach. Due to the increased awareness of cyber-threats, White predicts the demand for cyber coverage will only increase as more insurance companies enter the field and offer a wider variety of coverage.