International cyber insurance rates have tumbled 43% since the fourth quarter of 2023, a slide that specialist underwriter DUAL warns is pushing the sector towards an inflection point in 2026 as widening exposures and an elevated threat environment test its long-term sustainability.
In a fresh global outlook, DUAL chief executive Richard Clapham (pictured above) said the cyber market "continues to play a vital role in enabling resilience against an increasingly complex and interconnected threat landscape," with the report blending proprietary data and views from the firm's regional specialists.
Pricing, DUAL argues, is nearing a floor in the United States, which accounts for roughly 70% of global cyber gross written premium and has historically set the tone for the wider market. Munich Re has put the size of that wider market at US$15.3 billion in 2024.
The segment has cycled through exposure-led expansion, a pricing correction and prolonged softening, DUAL says, and rates are still falling even as threats escalate and coverage broadens. International markets are driving the current leg down.
Brokers see little immediate relief. Lockton said in February that further reductions are likely at least through the first half of 2026, pointing to aggressive growth targets across London market insurers and fresh capacity from two new MGAs and a syndicate that launched cyber portfolios in the first quarter alone.
Even so, Lockton noted that insurers themselves now believe pricing is hovering near the lower end of what is sustainable, with claims activity more pronounced than ever. S&P Global Ratings has forecast a 15% to 20% premium increase in 2026 as severity catches up.
The numbers behind the claims trend are striking. Research from At-Bay found the average ransomware claim hit US$508,000 in 2025, up 16% year on year, while third-party liability claims jumped 70%, the steepest rise among tracked incident types.
Coalition's latest cyber claims report placed the average ransom demand above US$1 million last year, a 47% increase, with individual demands reaching as high as US$16 million.
Those pressures are already showing up in underwriting results. Combined ratios are deteriorating across the US, Europe, the UK and Australia and New Zealand, DUAL says, and several markets could turn unprofitable by 2027 if current trends persist.
The US combined ratio is projected to breach 100% by that year, Europe is expected to find its floor, the UK is in late-stage softening and ANZ continues to soften as new capacity arrives.
Ali Khodabakhsh, head of cyber for Europe at DUAL, said margins will tighten for some carriers if the slide goes on.
"The first path leads to gradual price stabilisation over the next 12 months, supporting a sustainable and more resilient market," he said, while the second risks a sharper correction.
