Markets/Coverages: Markel Launches Affirmative Cyber Product for Collateral War Cover

Markel Insurance, the insurance operations within Markel Group Inc., launched a specialist cyber product to provide up to US$5 million of cover per risk for indirect losses arising from an act of war.

Cyber risks are a significant concern for large organizations, particularly those in sectors including critical infrastructure, technology, finance and energy. Although full-scale cyber warfare events remain relatively rare, state-sponsored and geopolitically motivated cyber threats continue to increase in frequency and severity.

State-sponsored cyber-attacks accounted for 35% of all breaches in 2024, said Markel, quoting a report from Bright Defense, published in April. Markel noted that multinationals are often the targets or suffer collateral damage.

The new product, developed by Markel International’s London-based cyber team, provides cyber cover for collateral damage caused by acts of war, in other words losses arising from the indirect impact on an Insured from a war (whether declared or not). Cover for this peril is typically excluded in cyber insurance policies.

The new solution has been developed as a wrap-around product for large corporate clients with existing (Markel or non-Markel) cyber insurance policies. If the insured’s existing policy is less restrictive on war (such as Type 4 war exclusions) and this is now moving to a more restrictive war exclusion that is not to the client’s preference, then this Markel product could provide the insured with an option to insure some or all of that lost coverage.

Markel has ring-fenced a fixed amount of aggregate limit for this specific product, which it will be offering under its own name, using its own legal and financial backing. It will initially be offering a limit of up to US$5 million per risk.

“With this new product, Markel is responding to the changing needs of our clients. We’re conscious that some larger clients still want cyber cover for the indirect impact of war, and this product is a step toward helping provide them with a priced-for insurance policy that explicitly covers this particular risk,” commented Chris Burgess, director of Cyber at Markel International.

Although Markel is initially beginning with a low limit, Burgess said the product “is a step in the right direction towards providing a market-wide solution for these highly prevalent risks.”

Source: Markel Insurance

Topics Cyber New Markets