By Ryan Smith
There has been a spike in demand for cyber products among captive owners, according to a new survey by Aon.
The report surveyed Aon captive owners and parent companies to provide insights into the strategic value of captives, current data and practices related to captive insurance and retail-market cyber trends.
Aon found that the growth in gross written premium for cyber risks in the captive market has accelerated by 263% year over year. The leading industries buying cyber coverage within a captive are healthcare (19%) and energy (15%).
Forty-one per cent (41%) of captives are incubating cyber risk, and 63% have business-interruption wording in their cyber policies.
Twenty-six per cent (26%) of captives have suffered a cyber loss, and 29% of those losses have been full-limit losses, Aon said.
The company estimated that 34% of all captives will be underwriting cyber within five years.
“Captives continue to play a valuable role in addressing emerging risk issues for all companies,” said John English, CEO of captive and insurance management for Aon. “Our survey demonstrates that a captive not only can provide access to innovative coverage and unlock additional capacity for this fast-moving risk topic, but also better coordinate key internal teams in a company to improve overall capital allocation, strategic planning, and risk improvement for cyber risk.”