Global cyber premiums experienced slower growth at only 7% in 2024, reaching nearly US$15bn, compared to rates in previous years, according to Moody’s Ratings in a segment report on Monday, 8 September.
The ratings agency attributed the sluggish trend to the stagnant demand for cyber coverage, particularly in the US market. In contrast, from 2018 to 2022, growth rates in the segment stood between 20% and 40%.
At the same time, Moody’s said cyber insurance rates are expected to keep declining in the single-digit range since 2023. Strong profitability has attracted new capital, and existing insurers have expanded their cyber capacity, intensifying competition and pushing prices lower.
Most of the premium growth came from outside the US, where lower penetration rates and increased regulatory requirements are spurring demand for cyber coverage, Moody’s said. Meanwhile, the US market, the largest in the world, is tapering off, with statutory direct written premiums declining by about 1.5% to US$7.1bn in 2024, following a modest 0.7% contraction in 2023.
Apart from Germany, France, and Italy, the Asia Pacific and Latin American regions are considered potentially untapped areas for growth. APAC is poised to represent 8% of the global cyber insurance market by 2027, with regional premiums expected to surpass US$3bn by 2030, Munich Re said in its April 2025 report.
Nonetheless, rates in the Asia and Pacific regions have continued to drop in recent quarters, as data from Marsh shows, due to competition, growing capacity—including from London—and more first-time buyers seeking enhanced coverage options.
Even with softening market trends, cyber still demonstrated solid profitability in 2024.
The sector continues to benefit from significant price increases and tighter policy terms implemented in 2021-2022. In the US, the aggregate combined ratio in 2024 was about 79% for primary cyber insurers and 84% for excess coverage.
Moody’s further noted that policyholders’ improved cyber hygiene and government efforts to reduce cybercrime have “helped insurers generate healthy underwriting profits in the past three years.”
With competition pushing prices lower, the agency expects premium growth to slow further, remaining in the single-digit range over the next several years. It added that continued pricing reductions and broader terms are likely to lead to lower margins.
Ransomware and systemic exposures remain key risks
Ransomware remained the greatest loss driver for cyber, according to Moody’s, but premium payments saw a 35% decline to US$814m in 2024 from a high of US$1.25bn in 2023.
Moody’s said this indicates that “victims have become less willing to pay a ransom and are relying on recovering encrypted data from backup systems, improving incident response, and implementing other remediation strategies.”
Despite this trend, the agency added that the cyber market remains relatively untested, as there has been no major catastrophic event that could put a strain on insurers’ profitability.
Other emerging risks may arise and cause uncertainty for the market. These include systemic and aggregation risks, ranging from malware or cloud outages to uninsurable losses such as attacks on critical infrastructure or cyber war.
The widespread use of generative artificial intelligence (AI) and other advanced technologies could also raise the frequency of cyberattacks, which Moody’s said could be personalised and require more robust detection and prevention.
Based on Guy Carpenter, as cited by Moody’s, vendor modelling industry losses for a one-in-200-year return period could range from US$20 bn to US$45bn.
“Given the potential size of exposures and complexity of the risks, cyber risk modelling is expected to remain a key area of focus,” Moody’s said.
