The Cyber Security Insurance market comprises policies that provide coverage against internet-based risks, cyber threat risks such as data breaches, hacking, phishing, and denial of service (DOS) attacks. With companies increasingly moving to cloud-based infrastructure and storing sensitive customer and employee data online, the need for cyber security insurance has grown. Cyber attacks have become more sophisticated over time with the emergence of new technologies. Protection against the financial loss and reputational damage caused by such cyber risks is driving more organizations to opt for cyber security insurance policies.
The Global Cyber Security Insurance Market is estimated to be valued at US$ 15.7 Mn in 2024 and is expected to exhibit a CAGR of 7.8% over the forecast period 2024 to 2030.
Key Takeaways
Key players operating in the Cyber Security Insurance market are Advacare Pharma, UEBE Medical, Abbott Laboratories, Quidel Corporation, HiLin Life Products Inc., Geratherm Medical AG, Fertility Focus Limited, Fairhaven Health LLC, Church & Dwight Co. Inc., and Prestige Brands Holdings Inc., among others.
The growing instances of sophisticated cyber-attacks targeting large enterprises have increased awareness about cyber risk management. As a result, the demand for cyber security insurance from small and medium enterprises is also growing at a brisk pace seeking financial protection from cyber breaches.
Growing digitization and increasing cross-border data flows have led to expansion of Global Cyber Security Insurance Market Size. Regional players are also entering the market to cater to the rising need for such policies. North America currently dominates the cyber security insurance space but Asia Pacific is expected to exhibit fastest growth over the coming years.
Market drivers
Increasing dependence on digital technologies and growing mobility of workforces have significantly expanded the threat surface for cyber criminals. Even a single vulnerability can be exploited by hackers to gain access to sensitive data. This is driving organizations to buy cyber security insurance policies to transfer the financial risk of cyber breaches and attacks to insurers. As cyber threats continue to evolve rapidly, the demand for such insurance options is expected to rise substantially over the forecast period.
The current geopolitical situation is significantly impacting the growth of the cyber security insurance market. With rising geopolitical tensions and conflicts globally, the threats of cyber attacks on critical infrastructure and businesses have increased manifold. Nation state actors are increasingly using cyber attacks and information warfare as strategic tools, leading to greater uncertainties. This has heightened concerns around data breaches, network failures and disruptions among organizations. There is a growing need to secure business operations and protect sensitive data from cyber threats which now have political undertones.
However, organizations are facing challenges in assessing geopolitical risks and factoring them into their cyber security strategies and insurance plans. Insurance providers also find it difficult to price policies by accurately gauging risks stemming from political conflicts and territorial disputes. As geostrategic risks are unpredictable in nature, the coverage and scope of existing policies may become outdated. Insurance players will need to devise flexible plans with provisions for covering indirect losses due to regional political issues. Simultaneously, businesses must strengthen resilience of their cyber security infrastructure and boost capabilities of their incident response teams to mitigate adverse impacts of geostrategically motivated cyber attacks.
In terms of regions, North America currently dominates the cyber security insurance market in terms of value, holding over 35% share. This is owing to stringent data privacy regulations and rising adoption of cyber insurance among companies in the US and Canada in the wake of high-profile cyber breaches. Moving forward, Asia Pacific is expected to demonstrate fastest growth on account of rapid digital transformation of economies, significant Internet penetration and increasing instances of cyber crimes in major countries like China, India and Australia.
The current geopolitical situation is significantly impacting the growth of the cyber security insurance market. With rising geopolitical tensions and conflicts globally, the threats of cyber attacks on critical infrastructure and businesses have increased manifold. Nation state actors are increasingly using cyber attacks and information warfare as strategic tools, leading to greater uncertainties. This has heightened concerns around data breaches, network failures and disruptions among organizations.
There is a growing need to secure business operations and protect sensitive data from cyber threats which now have political undertones. However, organizations are facing challenges in assessing geopolitical risks and factoring them into their cyber security strategies and insurance plans. Insurance providers also find it difficult to price policies by accurately gauging risks stemming from political conflicts and territorial disputes. As geostrategic risks are unpredictable in nature, the coverage and scope of existing policies may become outdated. Insurance players will need to devise flexible plans with provisions for covering indirect losses due to regional political issues. Simultaneously, businesses must strengthen resilience of their cyber security infrastructure and boost capabilities of their incident response teams to mitigate adverse impacts of geostrategically motivated cyber attacks.
In terms of regions, North America currently dominates the cyber security insurance market in terms of value, holding over 35% share. This is owing to stringent data privacy regulations and rising adoption of cyber insurance among companies in the US and Canada in the wake of high-profile cyber breaches. Moving forward, Asia Pacific is expected to demonstrate fastest growth on account of rapid digital transformation of economies, significant Internet penetration and increasing instances of cyber crimes in major countries like China, India and Australia.
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