Cybersecurity insurance costs spike up to 30% amid surges in ransomware attacks, GAO report finds

Hackers are increasingly carrying out cyberattacks on hospitals, highlighting the critical need for stable cybersecurity insurance. Yet, as the number of attacks on hospitals surges, so does the cost of insurance, according to a May 20 report by the Government Office of Accountability.

Four key findings:

1. As demand for cybersecurity insurance rose, so did insurance costs. In a survey of insurance brokers, more than half of brokers said client prices rose from 10 percent to 30 percent in late 2020. Only 15 percent of brokers said there was no increase in insurance prices.
2. Industry representatives told GAO that rising attacks led insurers to reduce their coverage limits for high-risk industry sectors, such as healthcare and education.
3. The brokers told GAO that their clients' take-up rate, the proportion of existing clients electing coverage, for cyber insurance rose from 26 percent in 2016 to 47 percent in 2020. The healthcare and education sector had the highest take-up rates because of the amount of sensitive information they have access to.
4. Insurers are increasingly offering policies specific to cyber risk, rather than including cyber risk in a package with other coverage. This move reflects a desire to provide more clarity on what is covered and the limits of cyber-specific coverage, the report said.

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