Insurers that offer protection from cyberattacks are increasing prices to unseen levels following 18-months of ransomware attacks that have impacted critical infrastructure among many targets.
Since insurers offered cyber policies in the late 1990s, they’ve typically made large profits, according to Jamie MacColl, a cybersecurity researcher at the Royal United Services Institute, a UK think tank.
In the first quarter of 2021, U.S. cyber insurance premiums increased an average of 18%, according to the Council of Insurance Agents & Brokers. That price jump outpaced all other major insurance categories.
“Ransomware has really brought home for the market that the price was too low,” MacColl told Quartz. “They don’t have enough premium to cover their losses. I think this is probably the first year where cyber insurance as a market will have made a loss.”
According to a June cyber insurance report from AM Best, ransomware attacks now account for 75% of all cyber claims.
The rise in cyber insurance premiums means that ransomware risks aren’t just hurting the companies that get hacked but spreading the costs to every firm that buys cyber insurance.
Read more about cyber insurance pricing at Quartz.
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