As 2021 became the year of ransomware attacks, businesses realized that failing to incorporate risk-sharing techniques into their risk management strategies can have significant financial ramifications. As a result, organizations are transferring a large part of their cyber risks to insurers. Last year alone, IT firms saw an increase in claims frequency by 46%, professional services companies by 53%, and a whopping 263% for businesses in the industrial sector, according to a report by Coalition.
As the financial impact of cyberattacks continue to surge beyond $6 trillion annually, cyber insurance is predicted to become as crucial for businesses as auto insurance is to cars and health insurance is for people. It is only a matter of time before cyber insurance becomes mandated for organizations, like workers compensation, property and liability insurance. Before this happens, what needs to be required to standardize and regulate cyber insurance? There is a win-win solution for both the payer and enterprise in the form of standardized cyber risk measurement.