The Global Cybersecurity Insurance Market size is expected to reach $32.6 billion by 2028, rising at a market growth of 18.8% compound annual growth rate (CAGR) through 2028, said Research and Markets in its latest forecast.
Of that figure, by 2028 roughly two-thirds will be generated by solutions and the remainder by services. Overall, since 2019, the demand for cybersecurity insurance by services organizations has grown faster than that of solutions. In 2019, the market totaled $6 billion.
Throughout the forecast period, the banking and financial institutions sector is anticipated to control a substantial portion of the market driven by demand for identity and risk coverage, particularly considering how tightly controlled and governed that business is, the analyst said.
Among the factors that have driven the demand for cybersecurity northward, is cyber criminals’ continued keen interest in financial gain from selling confidential personal data on the dark web, Research and Markets said. Another is the rise of cloud computing that has changed the IT landscape and opened up new markets but brought with it more cybersecurity risk. As a result, some IT stakeholders and companies are exploring modernized insurance models.
COVID-19's Market Impact
The impact of COVID-19 is another driver prodding the market higher with an increase in distributed working environments bringing with it more risk associated with remote workers. As a result, demand for cybersecurity insurance has risen to protect against losses from cyber attacks.
Other market factors:
- Blockchain and artificial intelligence combined with risk analytics are expected to help cybersecurity insurance companies with some of their most pressing problems.
- Because companies are required to report data breaches to all impacted parties, the cost of a break-in can rise, bringing with it corresponding price increases in insurance coverage.
- The North America region garnered the highest revenue share in the cybersecurity insurance market in 2021. The market in this area is anticipated to develop significantly due to the presence of the majority of major players in the cybersecurity insurance market.
Partnerships Drive Cyber Insurance
Cyber insurers have also seen growth from partnerships with IT companies, MSSPs and M&A deals. For example, in August 2022 MSSP SolCyber partnered with Converge, an emerging cyber insurance provider, in a move to simplify the cyber insurance application and approval process for mid-market organizations.
At the same time, cyber insurance provider Coalition acquired Digital Affect Insurance from Munich Re Digital Partners. The result: Coalition gains a property and casualty insurer licensed in all 50 states. This is technology M&A deal number 734 that MSSP Alert and sister site ChannelE2E have covered so far in 2022. Coalition’s insurance firm’s forensic team has been known to work with MSPs to help customers mitigate data breaches.
And, in early August 2022, cyber insurer Cowbell Cyber and global reinsurance firm Swiss Re Group launched a cyber insurance program for enterprises’ Amazon Web Services (AWS) cloud workloads.