August 02, 2018

EIOPA published a report on understanding cyber insurance through a structured dialog with insurance companies in Europe. With the stand-alone cyber insurance market located predominately in the United States and only a fraction of the total market in Europe and with available reports and surveys focusing on the global or the US insurance market, very little attention has been paid to the European market so far. One of the key findings of the report confirms the need for a deeper understanding of cyber risk, which is a core challenge for the European insurance industry.

This challenge generates or fosters other challenges, such as improper treatment of non-affirmative risks and difficulties to quantify risks. The outcome of this structured dialog with the industry provides useful insights on the functioning, growth potential, challenges and risks of cyber insurance in Europe in the context of the expected growing importance of cyber insurance in the portfolios of (re)insurers. Additionally, the assessment finds that the cyber insurance industry expects a gradual increase in the demand for cyber insurance, mainly driven by new regulations, increased awareness of risks, and a higher frequency of cyber events. Lack of specialized underwriters, data, and quantitative tools are key obstacles to the development of the industry. Regulation may be welcomed by the industry in a moderate fashion, as it could help to address some of the identified challenges notwithstanding the need for compliance with the Solvency II Directive (2009/138/EU).

This report is based on a survey with responses to a set of 14 qualitative questions answered by 13 (re)insurance groups located in Switzerland, France, Italy, Germany, and the United Kingdom. The sample of eight insurers and five reinsurers was selected according to the expertise and current exposures in cyber insurance. The survey was conducted through three-party telephone interviews (EIOPA, national supervisory authorities, and participating (re) insurance group). This report is the first attempt by EIOPA to enhance the level of understanding of cyber risk underwriting, with a focus on the European insurance market. Further work in this field is necessary. Therefore, EIOPA included a combination of qualitative and quantitative questions on cyber risk in its 2018 Insurance Stress Test.

 

Related Links

Keywords: Europe, EU, Insurance, Cyber Risk, Cyber Insurance, EIOPA

Related Articles
News

APRA Releases Minor Changes to Reporting Standards on SA-CCR for Banks

APRA released minor changes to the three reporting standards for the standardized approach for measuring counterparty credit risk exposures (SA-CCR).

May 22, 2019 WebPage Regulatory News
News

APRA Proposes to Amend Guidance on Residential Mortgage Lending

APRA is consulting on revisions to the prudential practice guide APG 223 on residential mortgage lending in Australia.

May 21, 2019 WebPage Regulatory News
News

ESAs Amend Technical Standards on Mapping of ECAIs Under CRR

ESAs published a second amendment to the implementing technical standards on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs) for credit risk under the Capital Requirements Regulation (CRR).

May 20, 2019 WebPage Regulatory News
News

OCC Consults on Information Collection for Home Mortgage Disclosures

OCC is soliciting comment on the revision of the information collection titled “Regulation C—Home Mortgage Disclosure.” OCC also notes that it has sent the collection to OMB for review.

May 20, 2019 WebPage Regulatory News
News

EIOPA Updates Q&A on Regulations in May 2019

EIOPA published additional questions and answers (Q&A) on guidelines, directives, and regulations applicable to insurers in Europe.

May 17, 2019 WebPage Regulatory News
News

FSB Publishes Update on Meeting of RCG for Americas

FSB published a summary of the meeting of its Regional Consultative Group (RCG) in Americas.

May 17, 2019 WebPage Regulatory News
News

ESRB Paper on Impact of Business Model Similarities on Risk Capture

ESRB published a working paper on whether information contagion and business model similarities explain bank credit risk commonalities.

May 17, 2019 WebPage Regulatory News
News

CBM Notifies ESRB and ECB on Imposing Borrower-Based Measures in Malta

CBM notified ESRB and ECB regarding its decision to impose borrower-based measures on lenders in Malta.

May 17, 2019 WebPage Regulatory News
News

IASB Issues Work Plan and Meeting Updates for May 2019

IASB published an updated work plan, along with the update of its meeting in May 2019.

May 17, 2019 WebPage Regulatory News
News

FCA Publishes Its Business Plan for the Coming Year

FCA published its Business Plan, which sets out the main areas of focus and priorities for 2019/20.

May 17, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3103