More reinsurers to enter cyber market in 2024: Cybercube

More traditional reinsurers will start offering “meaningful” cyber reinsurance capacity in 2024, cyber risk analytics platform Cybercube has predicted.

Reinsurers in Europe and Asia will increasingly identify cyber re/insurance as an opportunity, the firm believes.

Reinsurance capacity is critical for the growth of cyber insurance, as around 50% to 60% of cyber premium are ceded to the reinsurance market.

“As reinsurers look at traditional lines of insurance being transformed by internet-connected risk, as well as the opportunity to participate in a rich new line of insurance, those reinsurers who were hesitant to dip their toe in the waters of cyber will increasingly see the imperative to do so.” Cybercube’s chief executive, Pascal Millaire, predicted in the firm’s 2024 look-ahead report.

Munich Re has forecast that the cyber re/insurance market will almost triple from around $12bn today to $33bn by 2027.

Cybercube also believes that developments in artificial intelligence (AI) will increase the frequency of cyber attacks.

AI tools have improved the effectiveness of phishing campaigns by eliminating previously recognized indicators of phishing emails, such as grammatical and spelling errors, Cybercube said.

In addition, CyberCube expect sensitive data to be targeted by threat actors using large language models (LLMs) and associated infrastructure as conduits.

“Combining AI-generated source code with human-generated source code in software development opens up a new world of vulnerabilities,” said Ashwin Kashyap, co-founder and chief product officer at Cybercube.

“It has never been easier or faster to develop software with the emergence of AI co-pilots, but there is no promise of more secure software yet,” Kashyap added. “This presents a window of opportunity for sophisticated, motivated threat actors to discover and exploit vulnerabilities in poorly secured software.”