Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Denver news in your inbox

Catch up on the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Des Moines news in your inbox

Catch up on the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Minneapolis-St. Paul news in your inbox

Catch up on the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tampa Bay news in your inbox

Catch up on the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Charlotte news in your inbox

Catch up on the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Sarah Grillo/Axios

Cybersecurity insurance is getting a lot of attention from investors right now as more and more companies try to manage their increasing risks.

The trend: There will “absolutely” be consolidation in the cybersecurity insurance market, in particular for firms that assess the risk of companies seeking insurance, Ken Gonzalez, a managing director at investment firm NightDragon Security, tells Axios. And mergers and acquisitions could mean big pay-days for investors.

The likely acquirers will include traditional vulnerability management vendors, security services vendors, fintech companies, and insurance companies, Gonzalez, a partner at Momentum Cyber, a cybersecurity advisory firm, said.

By the numbers: Global premiums are expected to surpass $20 billion by 2025, according to Allianz. In the second quarter of 2018, U.S. cyber-insurance prices jumped by 2.1%, in part due to an increase in claims and coverage, per Marsh’s quarterly Global Insurance Market Index. But pricing was tempered last quarter due to competition among insurers.

  • 76% of U.S. executives today have some form of cybersecurity insurance, per Ovum and FICO. A year ago, 50% had none.
  • Five years ago, cybersecurity risk was ranked the 15th most important business risk, according to the Allianz Risk Barometer, based on a survey of global insurers and brokers. Now it is seen as the second most important.

Driving the market: “There have been very few major payouts against cyber-insurance policies, so for now, the cyber-insurance business looks pretty profitable relative to other areas of insurance," per Gonzalez.

  • For example, just this summer a bank in Virginia sued its insurance provider for not fully covering two cyber intrusions, per KrebsOnSecurity.
  • Yes, but: Gonzalez points out that a systemic cyberattack could instantly change how lucrative the market is.

The context: Cyber coverage has been around since the late 1990s and used to be bundled in some traditional insurance offerings, like liability, property, and crime insurance. But because cyberthreats are so complex, it became necessary to pull it out as standalone coverage.

What to watch: Cyber-insurance purchases spike in the aftermath of a prominent and expensive incident, per Marsh's index. The growth of cyber-insurance purchases is fastest for small-to-medium enterprises, per Trend Micro, a cybersecurity company.

  • A more structured regulatory environment could boost companies’ interest in obtaining cybersecurity insurance. All 50 states now have data breach notification laws. Europe’s new General Data Protection Regulation threatens massive fines for failure to keep data safe.

The other side: Skeptics say cybersecurity insurance might not go very far because almost no insurance policy is able to remedy the long term business consequences of reputation damage — which accounted for almost 89% of losses in one cyber incident in a Deloitte modeling.

The big picture: "There’s always going to be some tail of risk that a company will want to insure against.  You can’t buy enough security technology and services to prevent every attack. There’s unknown risk that you can’t even qualify," Gonzalez says.

Go deeper: The rise of cybersecurity insurance

Editor's note: This story has been updated to clarify the spike in purchase prices.

Go deeper

Updated 6 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Eniola Odetunde/Axios

  1. Health: Most vulnerable Americans aren't getting enough vaccine information — Fauci says Trump administration's lack of facts on COVID "very likely" cost lives.
  2. Politics: Biden unveils "wartime" COVID strategyBiden's COVID-19 bubble.
  3. Vaccine: Florida requiring proof of residency to get vaccine — CDC extends interval between vaccine doses for exceptional cases.
  4. World: Hong Kong to put tens of thousands on lockdown as cases surge.
  5. Sports: 2021 Tokyo Olympics hang in the balance.
  6. 🎧 Podcast: Carbon Health's CEO on unsticking the vaccine bottleneck.

Trump impeachment trial to start week of Feb. 8, Schumer says

Senate Majority Leader Chuck Schumer. Photo: The Washington Post via Getty

The Senate will begin former President Trump's impeachment trial the week of Feb. 8, Majority Leader Chuck Schumer announced Friday on the Senate floor.

The state of play: Schumer announced the schedule after reaching an agreement with Republicans. The House will transmit the article of impeachment against the former president late Monday.

8 hours ago - Health

CDC extends interval between COVID vaccine doses for exceptional cases

Photo: Joseph Prezioso/AFP via Getty

Patients can space out the two doses of the coronavirus vaccine by up to six weeks if it’s "not feasible" to follow the shorter recommended window, according to updated guidance from the Centers for Disease and Control and Prevention.

Driving the news: With the prospect of vaccine shortages and a low likelihood that supply will expand before April, the latest changes could provide a path to vaccinate more Americans — a top priority for President Biden.

You’ve caught up. Now what?

Sign up for Mike Allen’s daily Axios AM and PM newsletters to get smarter, faster on the news that matters.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!