USD 3252B market boom expected by 2028, fueled by cyber risks

January 26, 2024
1 min read

TLDR:

• The cybersecurity insurance market is projected to reach USD 32.52 billion by 2028, with a CAGR of 18.06%.
• The market growth is driven by the increasing complexity of digital ecosystems, including cloud technologies, Big Data, IoT, and AI, which are increasing workloads on IT frameworks globally.

The cybersecurity insurance market is expected to reach USD 32.52 billion by 2028, with a compound annual growth rate (CAGR) of 18.06%. This growth is fueled by the escalating workloads on IT frameworks globally due to the increasing complexity of digital ecosystems, including cloud technologies, Big Data, IoT, and AI.

The insurance market is focusing on comprehensive security policies that extend to emerging technologies and the evaluation of an organization’s data sensitivity. This includes the application of innovative techniques such as micro sharding, which minimizes data attack surfaces by breaking down and dispersing data fragments. These technologies are becoming crucial in determining risks and insurance premiums.

The BFSI industry, as a core segment, is experiencing an increasing volume of cybercrime incidents, leading to a higher demand for comprehensive cybersecurity insurance solutions. The United States dominates the cybersecurity insurance market in North America, fueled by the growing frequency of cyberattacks and connected devices within the country.

The cybersecurity insurance market is moderately consolidated, with key players investing in technological advancements, mergers, and partnerships. Noteworthy strategic alliances, such as the collaboration between CloudCover Re and Hylant to launch a novel cybersecurity insurance program, contribute to the market’s momentum.

Regulatory requirements, such as the Federal Trade Commission’s Safeguards Rule, are influencing market dynamics by necessitating increased data protection investment. In addition, alliances between technology firms and insurers are bolstering market growth and innovation. The cyber threat landscape in the United States is also influencing global market performance, leading to significant investments in cybersecurity insurance.

As digitalization transforms business operations, the growth of the cybersecurity insurance market reflects a collective commitment to secure and resilient digital infrastructures. Major players in the market include American International Group Inc., Zurich Insurance Co. Ltd, Aon PLC, Lockton Companies Inc., The Chubb Corporation, AXA XL, Berkshire Hathaway Inc., Insureon, Security Scorecard Inc., Allianz Global Corporate & Specialty (AGCS), and Munich Re Group.

Overall, the cybersecurity insurance market is experiencing significant growth due to the increasing complexity of digital ecosystems and the rising cyber threat landscape. As organizations recognize the potential risks, they are investing in comprehensive insurance solutions to protect against cyberattacks and data breaches.

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