Number of Companies Buying Cyber Insurance up by One-Third in 2012: Marsh
Services and Educational Sectors Lead the Way in Purchasing Coverage
NEW YORK -- March 14, 2013
More companies are turning to cyber insurance to protect their organizations
from the financial consequences of a data breach or cyber attack, according to
a report issued today by Marsh. The number of Marsh US clients purchasing
cyber insurance increased 33% in 2012 over 2011, with those in the services
and educational sectors leading the way.
Companies also are purchasing higher levels of cyber coverage, according to
the report, Benchmarking Trends: More Companies Purchasing Cyber Insurance.
Cyber insurance limits purchased in 2012 averaged $16.8 million across all
industries, an increase of nearly 20% over 2011. Communication, media, and
technology companies led all industries, both by average limits purchased —
$33.4 million — and the rate of increase over 2011, which was nearly 36%.
“Awareness of cyber and privacy risks continue to grow, especially in the wake
of a number of highly visible data breaches, hacking attacks, litigation, and
increased government focus on cyber security,” said Bob Parisi, Network
Security and Privacy Practice Leader for Marsh. “As a result, companies are
now looking to manage their day-to-day cyber risks in the same way they do
more traditional risks—through the purchase of insurance.”
According to the report, the services industry, which includes professional,
business, legal, accounting, and personal services firms, experienced the
largest uptick in the number of clients purchasing cyber insurance — a 76%
jump over 2011. This was followed closely by the education sector, which
experienced a 72% rise and financial institutions, which experienced a 32%
Overall rates for cyber insurance were essentially flat in the fourth quarter
of 2012, although market conditions varied significantly by company size, the
Smaller companies, where demand is great and competition among insurers is
strong, typically paid less for cyber coverage than larger companies, which
are experiencing more severe and frequent claims.
To access the Benchmarking Trends: More Companies Purchasing Cyber Insurance
Marsh, a global leader in insurance broking and risk management, teams with
its clients to define, design, and deliver innovative industry-specific
solutions that help them protect their future and thrive. It has approximately
26,000 colleagues who collaborate to provide advice and transactional
capabilities to clients in over 100 countries. Marsh is a wholly owned
subsidiary of Marsh & McLennan Companies (NYSE: MMC), a global team of
professional services companies offering clients advice and solutions in the
areas of risk, strategy, and human capital. With over 53,000 employees
worldwide and annual revenue exceeding $11 billion, Marsh & McLennan Companies
is also the parent company of Guy Carpenter, a global leader in providing risk
and reinsurance intermediary services; Mercer, a global leader in talent,
health, retirement, and investment consulting; and Oliver Wyman, a global
leader in management consulting. Follow Marsh on Twitter @Marsh_Inc.
Marsh’s Network Security and Privacy Practice has been a trusted advisor to
leading businesses for more than a decade. With a team of 20 dedicated cyber
advisory, placement, claims, and other experts in the US, Marsh teams with
clients to define their cyber risks and design and deliver the most
appropriate insurance program to meet their evolving needs.
Sally Roberts, 303-952-9453
Anand Poola, 212-345-4292
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