White Paper

A Cyber Insurance Backstop? Hold On — We Need to Build Resiliency First

Skyrocketing cyber insurance rates have many wondering if a federal backstop is needed. Experts say we need to tackle cybersecurity controls first.
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White Paper Summary

Insureds felt the pain of major cyber insurance rate increases in 2021 and 2022. Premiums jumped 50% in 2022, Bloomberg reported, as hackers launched more frequent ransomware attacks and other cyber intrusions.

The good news? We might be starting to see the calm after the storm.

Today, cyber insurance prices are moderating — rates flattened or decreased in 2023, even as the number of ransomware attacks rose — and are expected to continue to stabilize into 2024. Still, some insureds are concerned about how the line will mature and whether more support is needed.

“While we have insights from the past, predicting the future is difficult,” said Michelle Chia, chief underwriting officer for cyber in the Americas at AXA XL.

Enter public-private partnerships. Governments and insurers can work together to foster stability in the cyber space. A mix of regulations and a (potential) government backstop could provide needed protections now that cyber is a risk that affects every industry.

We’ll dive into what that could look like in a moment. First: Companies in all sectors will need to step up their cybersecurity game.

To learn more about AXA XL, please visit their website.

AXA XL, the property & casualty and specialty risk division of AXA, provides insurance and risk management products and services for mid-sized companies through to large multinationals, and reinsurance solutions to insurance companies globally. We partner with those who move the world forward. To learn more, visit www.axaxl.com.

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