US cyber premiums rose 20% in Q3: CIAB

US cyber premiums rose 20.3% in the third quarter of 2022, according to the Council of Insurance Agents & Brokers (CIAB), down noticeably from the 26.8% increase recorded  in the previous quarter.

It is also down significantly from the record peak of 34.3% recorded in the fourth quarter of 2021.

“Some brokers believed premiums had stabilized slightly for the line, especially if insureds implemented appropriate risk controls,” the CIAB wrote.

The report notes that “clear problems” remain for insureds, such as higher deductibles, and the addition of sublimits to ransomware and cyber extortion coverages, even if the account had a clean loss history.

As with last quarter, insureds’ awareness of the need for cyber insurance remained high, with 78% of brokers surveyed reporting an increase in demand for the line. 

“Insureds declined [cyber coverage] in the past,” said one respondent from a large Northeastern firm, “but cyber and flood are being added to programs more often now.”

Another respondent from a large Northeastern firm offered a possible reason why insureds were more willing to purchase cyber insurance in the third quarter, explaining, “requests for cyber quotes have increased due to all the public discussion on ransomware and social engineering claims.”

Accordingly, 81% of respondents noted that a top client concern was cyber risk. 

In the third quarter,some 61% of respondents said they saw an increase in cyber claims, down from 64% in Q2 and 74% in Q1 2022, and a notable decrease from the peak of 81% in Q4 2021.