Howden Group’s annual cyber report, “Risk, Resilience and Relevance”, highlights cyber insurance market stabilization last year due to improved cyber hygiene following a spike in ransomware claims in 2020 and 2021.
The report notes significant advancements by carriers and brokers in enhancing price stability, coverage clarity, and the consistency of terms and conditions in recent years.
This progress presents two key opportunities to achieve Howden’s global premium projection of USD 43 billion by 2030: expanding beyond the US and targeting a broader client base among SMEs.
The market now faces a unique combination of heightened threats and a stable insurance environment supported by strong risk controls. This creates a foundation for a mature cyber insurance market driven by innovation and exposure-led growth.
Global Cyber Insurance Pricing Index
While the US currently leads the cyber insurance market, making up about two-thirds of the global share, its continued growth remains essential.
According to S&P Global Ratings, cyber insurance remains one of the fastest-growing areas within the global insurance industry, with premiums anticipated to exceed $20 bn by 2025
However, more than half of the premium growth by 2030 is expected to come from outside the US.
Favourable dynamics have persisted into 2024, with the cost of cyber insurance continuing to fall, despite ongoing attacks, heightened geopolitical instability and the proliferation of Gen AI
Sarah Neild, Head of Cyber Retail, UK, Howden
In major European economies like Germany, France, Italy, and Spain, matching the penetration levels of more established markets could increase premiums by around EUR 700 million.
Share of global cyber premiums growth by region
Meeting the demand in underpenetrated regions such as Europe, Latin America, and Asia, where Howden is heavily investing, presents significant growth potential.
As brokers and insurers develop better methods to engage these underserved areas, substantial growth opportunities in the cyber market emerge.
Cyber insurance is key to strengthening resilience around the world and insurers are now in a strong position to bring about real change
Jean Bayon de La Tour, Head of Cyber, International, Howden
Howden has launched a platform allowing SMEs to buy up to USD 6 million of cyber cover in four steps, requiring only the name, industry, revenue, and website to generate a quote. Innovation drives growth, necessitating a broking approach that is cycle-savvy, entrepreneurial, global, and home to top talent, according to Challenges for Cyber Insurance Market’s Growth Potential.
Cumulative global ransomware activity by month
Strengthened cyber resilience benefits policyholders as ransomware attacks increase, rising by 18% this year compared to 2023.
Despite this increase, fewer companies are paying ransoms due to more effective risk management, although recovery costs have rebounded after a temporary decline in 2022.
The full potential of cyber insurance can be unlocked by improving access to areas currently underserved by the market. Howden is spearheading these efforts by applying differentiated insights and expertise to deliver pioneering solutions
Shay Simkin, Global Head of Cyber, Howden
The market remains concerned about systemic risk, particularly aggregation risks highlighted by recent events. Analysis shows that indirect claims from third parties have been generally lower than direct claims, indicating that significant threats to the global premium base would require much larger or more frequent events.
The cyber insurance market shows strong prospects with a growing and diverse capital base. Sustained capital inflows are essential as the market expands to meet global business demands.
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