The Romania Cyber Insurance Market size is estimated to surpass $584.1 million mark by 2026, growing at an estimated CAGR of more than 32.6% during the forecast period 2021 to 2026. Rising need for high security in case of online transactions, social media, and applications are increasing the security needs of the companies at a rapid rate. Cyber-attacks can cause severe financial and other losses to an organization or an individual. Cyber insurance policy/cyber liability insurance policies/cyber risk insurance allows an organization’s liability for any kind of sensitive data breach, cyber extortion, and network interruption. The market will be driven by the growing awareness against cyber risks and cyber-attacks in many organisations.
Romania Cyber Insurance Segment Analysis – By Insurance Type
Stand alone is growing at a highest CAGR of 35.1% in the forecast period 2021-2026. These policies help the companies in eliminating the risk of silent exposures and makes the market more resilient. Many cyber insurance companies are seeing a shift of policy buyers from endorsement to standalone policies as they help eliminate the risk of silent exposures and makes the market more resilient. This type of policies typically offer liability and risk coverage for losses related to data breaches. In addition, businesses filing a cyber-incident related insurance claim under standalone policies are able to receive monetary compensation of their legal and investigative fees as well as the cost the loss incurred. Moreover several advantages such as availability of the dedicated limits for cyber-attacks, demand for expanded business interruption coverage, expanded coverage of other areas by endorsement policies, and expanded monetary limit in case of the data breach are some of the major reason for the shift from endorsement to standalone policies. Further standalone cyber insurance policies compensate the insured client or customer for the credit monitoring costs, IT forensic costs, data restoration costs, and public relations expenses, which might be incurred due to a data breach. Additionally, such policies also offer cover for the direct losses due to phishing, social engineering frauds, cyber frauds, spoofing, and phreaking, as well as companies’ legal liabilities to third parties.
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Romania Cyber Insurance Segment Analysis – By End Use
Initially, Romania Cyber Insurance Market demand was seen in media, telecom, technology, and professional services. However, the recent growth is evident across all major industries. In 2020, health care, education, and gaming organizations were the major cyber risk insurance buyers. According to the IndustryARC report, the health care industry is the leading buyer of cyber risk insurance. Thus the demand for cyber insurance in the segment of health care is projected to grow at a CAGR of 38.5% during the aforesaid forecast period. Telecom sector being highly prone to cyber-attack, is considered as the major end-users for cybersecurity market. Approximately, 43% of Telecom organization suffered from DNS-based malware in 2019. Thus, telecom organizations are adopting advanced cyber insurance solutions. Along with the telecom sector, the aerospace industry is considered to be another key end-users to Romania Cyber Insurance Market.
Romania Cyber Insurance Market Drivers
Growing number of Cyber Attacks
Growing number of cyber-attacks in several sectors such as banking, healthcare, retail, financial institutions, and others, has led to the data security and reputational loss concerns. This is especially prevalent in the BFSI sector where a number of banks have been the subject of various cyber-attacks. Moreover, these cyber threats have several implications on public safety, economic prosperity, and government security. To address these issues, government of Romania has made stringent regulations and policies related to cyber-attacks and insurance, Moreover, increased awareness about business interruption (BI) risks and related insurance products in the recent years is driving the market growth. As a result, rise in number of cyber-attacks and security breaches across the industry will drive the growth of cyber risk insurance in the forecast period.
Increased Adoption in Healthcare Sector
Cyber insurance in healthcare sector is growing significantly owing to rapid increase in cyber-attacks. Moreover with the digitization of health records and increasing penetration of the internet, critical medical information has become vulnerable to hacking and breaches. To mitigate these risks, cyber insurance products are increasingly available in the market, more commonly as standalone, comprehensive risk and cyber liability insurance policy products. These policies offer not only indemnities for first and third party claims, regulatory fines and defence costs, but also provide an array of experts to provide assistance in the immediate aftermath of a cyber-event for post-incident public relations in health care sector. Hence increased adoption will drive the market in the forecast period.
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Romania Cyber Insurance Market Challenges
High Cyber Insurance Costs
The higher cost of cyber insurance is one of the major factors hindering the growth of the Romania Cyber Insurance Market. Insurance companies had to pay out expensive claims due to the ransom ware attacks in the last two to three years. Even if the cyber insurance companies do not cover the ransom amount, the cost of recovery for the compromised system is high. Cyber insurance companies are increasing the coverage costs to cover the additional costs due to the added services, such as negotiation with hackers and assistance for data recovery during a ransom ware cyber-attack. The rising prices of cyber insurance has slowed down the adoption as the organizations are more focused on increasing the cyber security and reduce the risks rather than pay the insurance premium.
Product launches, acquisitions, and R&D activities are key strategies adopted by players in the Romania Cyber Insurance Market. Chubb Limited, Team Insurance Broker, Zurich Insurance Group AG, Lockton Companies Inc., Munich Re Group, Allianz Group, Aon Plc, Arthur J. Gallagher & Co., AXA XL, Beazley Plc, The Travelers Companies Inc. and Axis Capital Holdings Limited are considered to be the key players of the Romania Cyber Insurance Market.
In 2019, Romania-based Leader Team Insurance Broker and U.K.-based insurer CFC Underwriting Ltd. have launched $11 million cyber insurance policy for technology companies in Romania.
Stand alone is growing at a highest CAGR of 35.1% in the forecast period 2021-2026. These cyber insurance policies compensate the insured client or customer for the credit monitoring costs, IT forensic costs, data restoration costs, investigative expenses, and post-incident public relations expenses, which might be incurred due to a data breach.
Large enterprises are the more-significant users of cyber insurance compared to SMEs due to the potential for denial of service attacks and other cyber-attacks as they deploy cloud, artificial intelligence (AI), internet of things (IoT), big data, and machine learning (ML) technologies in their operations .
Cyber insurance in healthcare sector is growing significantly owing to rapid increase in cyber-attacks, with the digitization of health records and increasing penetration of the internet.
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B. Cyber Security Market
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