The size of the problem associated with cyber attacks is becoming clearer as data breaches make more frequent headlines.
The number of large companies and corporations that have experienced highly publicized data breaches is rapidly rising, and other businesses have not failed to notice; having responded with the purchasing of cyber insurance policies to help to protect themselves from the extensive damages that this type of digital attack can bring.
Insurers that offer this type of data breach liability coverage are seeing notable growth in that business.
At the same time that hackers have been causing a great deal of grief to large organizations, they have, therefore, kicked a new market into higher gear, as cyber insurance becomes one of the primary tools in a company’s protection kit. It is becoming increasingly difficult to feel as though it is possible to be immune to the potential harm that hackers can cause, as businesses such as JP organ Chase, Home Depot, Sony, and Target have had their own defenses breached.
Now, cyber insurance companies are receiving inquiries at a rate that they have never before experienced.
According to Beazly Group underwriter, Nick Economidis, “Everyone’s swamped with new applications.” His company sells cyberattack insurance and has noticed a massive growth in the number of businesses that are seeking out this coverage.
Following the recent announcement of the breach of the Anthem health insurance company server, which may impact up to 80 million of that company’s customers, it is not difficult to believe that the demand for cyberattack insurance will rise.
Even before that most recent announcement, industry analysts were already reporting that spending on this type of coverage had almost doubled from 2013 to 2014, to bring it to about $2 billion.
Cyber insurance companies are scrambling to be able to keep up with the speed of the growth in demand. A study conducted last year by PartnerRe showed that 45 percent of these insurers had experienced a “significant” increase in their business. At Beazly, they reported a 150 percent increase in these policies from 2012 to 2013, with another 100 percent growth from 2013 to 2014.