Demand is being driven by high-profile breaches
Insurance against data breaches is on the cusp of breaking into the mainstream in the UK and Europe, according to a senior underwriter at Lloyd’s insurer Beazley.
Speaking to Insurance Times at Biba 2013, Beazley’s London head of the technology, media and business services (TMB) team Paul Bantick said: “Now in the UK it feels like it did four to five years ago in the US. Over the past few months there has been an uptick in interest from clients and brokers.”
Beazley began writing cyber insurance in the US four to five years ago when the market took off, and now writes annual premium of $100m (£66m) there.
The product’s take-off in the US was driven by regulation stipulating how companies responded to data breaches, which included informing both regulators and consumers.
While a vote on similar rules in the EU has been pushed back to July, Bantick says demand in the UK and Europe is being driven by the realisation of the damage that data breaches can do and how they are handled affects reputation.
Bantick noted that while buying data breach cover is now almost as automatic as buying property insurance, it is taking a while for buyers in the UK and Europe to include the product in their budgets.
“New insurance spend is never easy to get approved,” he said. However, he added: “We are seeing more people include it in their budgets. In the next 18 months it is going to keep growing exponentially.”
Most interest is coming from those with large amounts of consumer data, including financial institutions, retailers, education, hospitality and healthcare.