Insurance companies will continue to raise cyber insurance rates and adjust terms, especially exemptions, and reinsurance companies can support market growth, said Standard & Poor & # 39 ;s Corp. on Wednesday.
"The market would benefit from the development of a comprehensive retrocession market and the use of (insurance-linked securities) or alternative capital to improve capacity, according to the report, Cyber risks in a new era: Reinsurance companies can unlock the cyber insurance market .
"The market is facing increasing demand, but limited supply", and "the lack of capacity may hold back the development of a sustainable, cyber-re / insurance market", S&P said in the report.
"The dynamic change in claims patterns, rising cyber threats and enormous accumulation risk creates an opportunity for greater reinsurance capacity," says S&P.
"The number of reinsurance companies and insurers offering cyber protection is increasing in response. But with such a new segment we think it is important for reinsurance companies to offer primary insurance companies support for managing cyber risk and risk management processes, as they do for natural disaster exposures, says S&P.
Reinsurance support has become critical in helping primary insurance companies "manage their cyber risk effectively, strengthen cyber risk resistance, conduct cyber risk assessments, implement a cyber defense strategy and continuously monitor for future cyber vulnerabilities, "the report stated.