Demand for cyber protection has never been higher, with written premiums for standalone cyber coverage surging 29% in this year alone.
For one, there’s a growing climate of fear in digital space. Beyond firms of all sizes urgently seeking cyber insurance protection, retail consumers concerned with personal cybersecurity risks are also driving a boom in the global cyber insurance market.
|Digital Transformation market size||Estimated annual cyber insurance premiums written|
|2015||US$150.5 billion||US$3 billion|
|2016||US$179.4 billion||US$3.6 billion|
|2017||US$213.8 billion||US$4.3 billion|
|2018||US$254.9 billion||US$5.2 billion|
|2019||US$303.8 billion||US$6.2 billion|
|2020||US$362.2 billion||US$7.5 billion|
As cyber insurance becomes more prevalent, its virtues have also begun to align with specific needs of particular industries and individuals. While embedded insurance in e-wallets and tie-ups with neo banks have their appeal, cyber insurance partnerships are fast emerging in other sectors of interest.
Take a look at how 10 cyber insurance partnerships around the world are redefining insurance across various industries.
Cyber insurance partnerships can offer both prevention and cure.
That’s what UK-based cybersecurity specialist CyberSmart and digital business insurer Superscript promised in their tie-up earlier this year.
A provider of the government-backed Cyber Essentials scheme, CyberSmart’s partnership with SuperScript enables businesses that complete the scheme with CyberSmart to instantly subscribe to SuperScript’s cyber insurance via embedded insurance.
Not only can businesses get coverage faster, but they also benefit from more extensive coverage in areas like cyber and privacy liability, data recovery costs, and media and advertising liability.
With more than 25% of ultra-high net-worth entities targeted by cyberattacks and close to 40% lacking any cybersecurity plan, US-based cyber insurer CyberScout’s partnership with American International Group (AIG) in 2020 was well-placed to meet a pressing need.
Through the partnership, AIG launched the Family CyberEdge policy, which not only insures against a wide range of cyber and identity fraud risks, but also provides access to both AIG’s cyber insurance coverage and CyberScout’s cyber protection services.
According to CyberScout’s Global Markets commercial director Tom Spier, the policy is the first product in the market that offers “substantial cover limits” against a “wider variety” of cyber threats.
Cyber insurance partnerships can offer insurers quicker access to a wider market via new distribution channels.
Take Swiss Re’s Digital Life Insurance for example. While customers benefit from an added layer of protection thanks to digital fingerprints created by Connected Insurance’s AI chatbot, Swiss Re also stands to gain by selling the policy via digital platforms including payment apps, digital banks and e-commerce platforms.
Swiss Re’s partnership with Connected Insurance also enables it to tap into digitally savvier millennial consumers in Israel, which comprise more than 30% of the country’s population.
For Ecommerce companies like India-based firm Flipkart, user stickiness is king. The company’s recent foray into digital insurance is a bid to keep customers coming back by meeting more of their needs.
Part of Flipkart’s digital insurance play in collaboration with Bajaj Allianz General Insurance includes introducing an embedded “complete mobile protection” (CMP) plan that customers can buy for as low as 99 rupees. Customers who purchase mobile phones only need to share required details at checkout for the policy to be activated from the day of delivery.
Another aspect includes a separate “Digital Suraksha Group Insurance” launched in 2020. Under this policy, customers can opt for a 1-year cover at premiums as low as 183 rupees for coverage up to 50,000 rupees.
Most cyber insurance plans often insure against cybersecurity incidents with significant financial costs, like ransomware and cyber-attacks.
What makes Singapore bank DBS’s partnership with Chubb Insurance stand out is their CyberSmart insurance plan, which protects individuals against more personal events like cyberbullying and online identity theft instead.
Under this policy, legal expenses up to SG$25,000 and trauma counselling up to SG $2,000 will be covered. Insured individuals can also claim up to SG$2,000 for loss of personal income, and up to another SG$2,000 of additional expenses incurred due to the incident.
Naturally, the CyberSmart insurance plan is tailored to younger Singaporeans and problems they face when interacting online. Through their partnership, DBS and Chubb are able to offer the basic version of the plan at just SG$6 per month – affordable for individuals across most income levels.
Via cyber insurance partnerships, individuals and entities can both benefit from dynamic premiums that vary based on changes to their risk profile over time.
Thanks to a tie-up with Hitachi Solutions, the Sompo Japan Insurance’s new cyber product features premiums that vary depending on how well prepared insured companies with factories exposed to IoT were for potential cyber threats.
For customers, this means lower premiums over time if they adopt preventive measures a year after the plan comes into effect.
Globally, one out of every five small-medium businesses (SMB) don’t have any cybersecurity plans in place. That figure’s likely lower in Thailand, where local SMBs grappled with the 3rd highest number of ransomware attacks in ASEAN and a 37% spike in cybercrime last year.
Cisco’s partnership with Thai insurer Dhipaya hopes to change that. Their “TIP Cyber Guard Plus” plan is the first to offer insurance coverage to SMBs with annual revenues of US$30 million for cyber-related financial attacks in Thailand.
For some digital insurers like New Zealand-based Delta Insurance, cyber insurance partnerships are also a means to expand to new markets rapidly.
Founded in 2014, Delta Insurance plans to establish a presence in 10 countries by 2024. By forging cyber insurance partnerships with local players, the company now operates in Vietnam, Taiwan, Hong Kong, Cambodia, Thailand, and Singapore.
Delta’s recent expansion to Taiwan will see its Singapore unit provide employees of Taiwanese insurer Hotai Insurance with cyber insurance products, as well as long-term support services and training.
While the Cisco-Dhipaya partnership in Thailand sought to launch a new product that would revolutionise SMB cyber insurance coverage, Dutch B2B2C platform iptiQ’s collaboration with digital comparison and advice platform Independer had similar goals for consumer insurance instead.
Touted as the first of its kind in The Netherlands, their “Safe Online Insurance” offers customers help and compensation if they fall victim to cyber fraud, as well as data recovery after a cyber-attack.
Another SMB cyber insurance play, Chubb’s new Marketplace online trading platform provides Australia’s insurance brokers with easier access to local SMBs – many of whom still lack cyber insurance.
Developed and hosted in collaboration with Australian insurance e-service Sunrise Exchange, Marketplace’s suite of SMB-targeted insurance solutions will allegedly offer cyber insurance policies first.