Three-quarters of consumers have experienced some form of cybercrime, yet a majority remain uninsured, according to a recent report by the Insurance Information Institute (Triple-I) and HSB. The survey highlights that 28% of consumers had their social media accounts hacked, 23% faced data breaches compromising personal information, and 14% encountered online attacks. Despite these statistics, 56% of insurance agents reported that their customers do not understand or agree with the value of cyber insurance.
James Hajjar, chief product and risk officer for HSB, part of Munich Re, stated: “As digital lifestyles evolve and become more interconnected, so do the risks. The pace of personal cyber threats is increasing at an accelerating rate, and personal cyber insurance is one way to protect against these increasing risks.”
The report identifies identity theft/fraud, online fraud/scams, computer/device malware attacks, extortion, and online harassment as pressing threats communicated by customers to their insurance agents.
A key finding from the survey reveals a disconnect between agents' understanding of cyber insurance value and that of their clients. While 84% of agents comprehend its importance, only 43% believe their clients share this understanding. Additionally, although 77% of agents have presented personal lines cyber insurance to clients in the past month, adoption rates remain low.
Sean Kevelighan, CEO of Triple-I emphasized: “This is a challenge of the unseen threats – insurance agents see the storm but homeowners can’t envision the damage until it’s too late.” He further noted that consumer education and agent training are essential for increasing customer adoption.
Hajjar also remarked on the discrepancy between rising cybercrimes and low adoption rates: "The disconnect between the alarming rate of cybercrimes and the low adoption rate of personal cyber insurance is striking."
Dale Porfilio from Triple-I pointed out that there is a need for greater understanding among consumers regarding personal cyber risks: “This is a call to action from insurance professionals to provide greater understanding of the perils to consumers to drive product acceptance.”
The Insurance Information Institute has been providing insights into risk and insurance since 1960. As an affiliate of The Institutes, it represents diverse members accounting for nearly half of all U.S. property/casualty premiums written.