WITH the global cyber insurance market expected to reach $14 billion by 2022, according to Allied Market Research, Nigerian insurers appear not yet ready to take on the market though they desire its development.
The National Association of Insurance Commissioners in a statement weekend weighed in on the difficulty in writing cyber coverage and stated: “Cyber risk remains difficult for insurance underwriters to quantify due, in large part, to a lack of actuarial data. Insurers compensate by relying on qualitative assessments of an applicant’s risk management procedures and risk culture.
“As a result, policies for cyber risk are more customized than other risk insurers take on, and, therefore, more costly. The type of business operation will dictate the type and cost of cyber liability coverage. The size and scope of the business will play a role in coverage needs and pricing, as will the number of customers, the presence on the Web, the type of data collected and stored, and other factors.”
Cyber insurance policy premiums are not one size fits all, as premiums are factored on a company’s industry, services, type of sensitive data stored, collected, processed and the total number of records, data risks and exposures, computer and network security, privacy policies and procedures, among others.
However, industry operators indicate that organizations in Nigeria will begin to explore cyber insurance. This, according to them, will likely begin in the financial services industry which is the major target of cyber attacks in Nigeria.