M&A activity among major re/insurers is stirring fresh worries in the cyber insurance space, with specialists warning that capacity could shrink as consolidation gathers pace.
Insurance market still looks soft, yet the long-term effects of consolidation are getting harder to shrug off, according to Marsh.
Gamze Konyar, Head of Cyber at Marsh Europe, argued that recent deals between carriers pull capacity into fewer hands. Over time that squeeze may cut market availability, even if nobody feels it right this second. It’s the kind of shift that starts quietly, then bites later.
At the same time, systemic cyber events tick upward and ransomware continues to morph. Both trends make the market’s footing feel a bit shaky, according to our analysts.
Gamze Konyar said conditions have not slipped into a negative cycle. The steady inflow of new capital keeps the whole thing afloat.
New insurers keep stepping in, bringing extra capacity and more competition. Reinsurance pricing stays soft enough to support availability.
Guidelines across the market look consistent, and carriers seem more comfortable with organisations’ security maturity. It helps that many buyers have sharpened their controls through hard lessons rather than theory.
Excess layer facilities and consortium setups also keep building. Those structures give more buyers a way in and expand the broader market ecosystem, even if the architecture sometimes looks messy.
Looking ahead, the mood is cautiously upbeat. Rate reductions should carry on through late 2025, a sign of how competitive things remain. Konyar expects the soft patch to stretch into Q1 and Q2 of 2026.
Third-party cyber risk, especially within sprawling digital supply chains, may become the biggest headache for underwriters and corporate buyers. And with new technologies colliding in odd ways, the claims environment could swing around more than usual.
Regulators also look set to tighten the screws, adding another layer of pressure as the market tries to stay level.
