The global cyber reinsurance market has seen a rise in competition, particularly in quota share and excess of loss placements, allowing buyers to secure more favorable terms and enhanced coverage, according to Gallagher Re’s report on the 1.1.25 renewals.
While cyber war was a central theme in 2024 negotiations, the topic held less significance during this year’s discussions. Despite this shift, the industry continued to make progress toward agreeing on cyber war exclusions, with reinsurers demonstrating flexibility. As a result, the market is moving closer to aligning on standard coverage language.
Innovation within the market accelerated in 2024, with notable growth in the use of Insurance-Linked Securities (ILS) and Industry Loss Warranties (ILW), alongside increased diversification in traditional reinsurance structures.
The report also highlighted the growing risks from software and service supply chains, particularly in light of the global IT outages caused by a faulty CrowdStrike update. These events underscored the significant loss potential arising from non-malicious errors within the tech sector.
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