The future of cyber insurance: a market poised for major growth

What’s driving new growth?

A combination of improved cyber hygiene and a more stable underwriting environment puts the cyber market in a strong position to restore its trajectory of growth, after the premium base stalled in 2023. 

Even accounting for last year’s slowdown – due in large part to a major shift in the pricing cycle, which is now starting to stabilise (see Figure 1) – the market could still be on course to achieve a premium base of close to $40 billion by the end of the decade.

Figure 1: Howden’s Global Cyber Insurance Pricing Index – 2014 to 2Q24 
(Source: Howden)

Innovation is vital 

But to achieve such projections, insurers and brokers must refocus on innovation to grow their exposure base. 

External factors like geopolitics and macroeconomics will inevitably have an impact, but the market can secure long-term relevance by focusing on key issues within their control – including SME penetration, geographic expansion and continued model development.

At Howden, we’re at the forefront of these efforts. We work with insurers to deliver pioneering solutions that help break into company segments and geographies currently underserved by the market.

Our leading experts see these growth projections as very achievable – and, in fact, necessary – to meet the growing demands of clients worldwide.

Figure 2: Global cyber gross written premium projections up to 2030 
(Source: Howden, Market.US., Munich Re, S&P, Swiss Re)

New global opportunities  

Until recently, the US dominated cyber insurance, accounting for a whopping two-thirds of the global market. 

Now, in an unprecedented break with the past, international business is set to make up the majority of growth up to 2030 (see Figure 3), with Europe, the UK, Asia Pacific, Oceania and Latin America, standing out as the leading high-growth regions. 

This striking shift is being driven by pent-up corporate demand in these territories, amidst heightened threats, rising risk awareness and regulatory changes. 

The growth potential in major European economies, benchmarked against the more mature UK market, is explored in detail in the report.

Figure 3: Share of global cyber premiums growth by region – 2024 to 2030 
(Source: Howden)

SMEs: an untapped segment 

SMEs remain a largely untapped segment in the cyber market – offering huge potential for insurers willing to engage them.

They are the backbone of economic activity in advanced economies and are increasingly reliant on technology for their operations. 

Research from the World Economic Forum lays bare the opportunity in this space; with only one in four SMEs currently protected by cyber insurance. 

To compound matters, many lack the resources and knowhow to recover from a cyber attack. 

While progress is already being made in certain markets, a transformational approach is needed – with important opportunities for insurers in increasing risk awareness, linking rates more closely to hygiene levels and simplifying the buying process.

Howden SME cyber platform

In May 2024, we launched a platform to enable businesses with revenue of less than $250 million to buy up $6 million of cyber cover in four simple steps. 

Our platform has the potential to revolutionise the buying process for SMEs – which typically lack the resources to navigate existing submission demands – by only asking for name, industry, revenue and website to produce a quote for businesses. 

To uphold underwriting standards in this much-simplified purchase process, we gather supplementary data via open APIs. 

At Howden, we’re leading the way in cyber insurance – helping spur uptake in underserved countries and segments of the economy.