Data breaches leading to more cyberattack insurance adoption

Growing number of devastating data breaches leads to faster adoption of cyberattack insurance.

Published Sun, Feb 15 2015 11:45 PM CST   |   Updated Tue, Nov 3 2020 12:10 PM CST

Cybercriminals carrying out data breaches on organizations are helping create a suddenly booming cyberattack liability insurance market.

Data breaches leading to more cyberattack insurance adoption | TweakTown.com

Traditional insurance companies - and a growing number of niche cyberattack insurance providers - are overwhelmed by an avalanche of new applications. The cyberattack insurance industry reached close to $2 billion in 2014, which is double the previous year, according to industry analysts.

"Think of a massive cyberattack as an intelligent hurricane," said Ty Sagalow, COO of the eBusiness division of AIG, in a statement published by the Los Angeles Times. "If it hits a house that doesn't fall down it learns why the house didn't fall and it changes. It is a scary thing... scary things sell insurance."

Costs related to cyberattacks are rising, so insurers are capping maximum payouts, while insurance premiums are rising, with data breaches increasingly expected.

An experienced tech journalist and marketing specialist, Michael joins TweakTown looking to cover everything from consumer electronics to enterprise cloud technology. A former Staff Writer at DailyTech, Michael is now the West Coast News Editor and will contribute news stories on a daily basis. In addition to contributing here, Michael also runs his own tech blog, AlamedaTech.com, while he looks to remain busy in the tech world.

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