Blog / Cyber Insurance Premiums Are On Their Way Up

Way, way up.

Cyber insurance is a surprisingly recent new addition to the cyber security toolbox. It’s pretty simple; if you suffer a cyber attack, your insurance should help recover at least some of the damages inflicted by it. Despite how new cyber insurance is, it’s become a standard recommendation for businesses to have at least some coverage.

What’s the point of cyber insurance?

It’s much the same as automotive insurance. Cyber insurance is meant to help cover the often massive costs incurred by cyber security incidents such as ransomware infections, information breaches, or even accidents that cost your organization time and money. Cyber insurance isn’t limited to just covering ransomware though, although that is the most common reason to make use of it.

But why are prices going up?

I’ve written newsletters about cyber insurance before, as an increasing part of my job is reviewing customers’ application forms and my opinion’s on the record—some insurance companies have no idea how to properly underwrite the stuff. That might come off as a swipe at the sector, but I’ve also previously pointed out that the situation is improving rapidly. After all, insurers stand to make some decent money once they get the formula right.

Unsurprisingly, revamping that formula means cyber insurance premiums are on the rise. How quickly? The average price almost doubled in 2021.

Is that really all there is to it?

Another part of the reason for the quick price hikes has no doubt been the result of recent and extraordinarily expensive incidents impacting large organizations. In addition to the price adjustment, many insurers’ policies now offer much more restricted coverage.

So the financial incentive to properly handle cyber insurance is clearly working its way through the industry. While  the above report focused on the U.S., you can expect a similar shift up here sooner than later. You can likely expect to start seeing  not just cyber insurance premiums going up, but changes all the way down to the very forms you fill out.

With prices on the rise, getting proper advice on options is more important than ever. If you’d like help finding and applying for coverage that’s right for you, contact TRINUS today.

I’ll leave off today with a tidbit from A Midsummer Night’s Dream: “Well, sir, learn to jest in good time; there’s a time for all things.”

Be kind, courtesy your friendly neighbourhood cyber-man.