The top cyber insurance carriers in 2021 shifted to include Fairfax Financial Holdings and Tokio Marine U.S. as the marketplace grew 74% to over $4.8 billion, according to a report from Fitch Ratings.
Overall, the top cyber insurance underwriters are Chubb with 10% market share, Fairfax (9%), AXA XL (9%), Tokio Marine, AIG and Travelers (each with 5%). According to Fitch’s report, based largely on statutory financial supplements from insurers disclosing cyber-specific direct premiums, Fairfax reported 300% growth in premium in 2021 to move from eighth in 2020 to its current position thanks to the performance of its Crum & Forster, Hudson Insurance and Allied World operations.
Tokio Marine moved from 11th to occupy a spot in the top five underwriters after nearly 190% growth in 2021, driven mostly by HCC.
Combined market share of the top 10 carriers fell to 57% in 2021 from 67% in 2020, Fitch said.
The analysis found that Chubb’s cyber book is almost all package business and it is by far the largest writer of package cyber coverage with a market share of about 28%. Chubb had 36% market share in 2020.
CNA Financial Corp. is next with a 9% share. The market for package cyber products grew 48% to nearly $1.7 billion in direct written premiums in 2021. However, the number of policies issued fell 9% in 2021, likely due to the marketplace’s desire for affirmative cyber coverage, Fitch said.
Meanwhile, the standalone cyber market jumped 92% in direct written premiums in 2021 to over $3.1 billion.
“Besides growth in premium rates and higher demand for coverage, this growth is also attributed to insurers’ and policyholders’ desire to reduce ambiguity in what is covered regarding cyber risk, or ‘silent’ cyber risk,” Fitch said.
In response to claims, mainly from ransomware, rates for cyber insurance continue to increase as rates in other lines of commercial insurance moderate. Based on the cyber supplement data, cyber claims that were closed with a payment increased 200% in the last three years to more than 8,100 in 2021. About 28% of standalone cyber claims were paid and 37% of package cyber claims were closed with payment over the same time, Fitch said.
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