Cyber insurance remains one of the most dynamic specialty lines globally. While pricing has softened across many markets, the underlying threat landscape continues to harden.

Increased capacity and improved underwriting discipline have led to more competitive pricing and broader coverage — particularly for organisations that can demonstrate strong cyber controls. Insureds with robust frameworks such as MFA deployment, secure offline backups, endpoint detection, and tested incident response planning are seeing strong improvements in both pricing and terms.

However, softer pricing does not mean softer risk.

Claims activity remains persistent and increasingly sophisticated. Key drivers include:

• Ransomware evolving beyond encryption into data extortion and operational disruption
• Business email compromise and social engineering targeting financial controls
• Supply-chain and third-party technology vulnerabilities
• AI-enabled phishing and impersonation attacks

At the same time, regulations around data protection and breach notification continues to intensify. Cyber incidents now carry not only operational consequences, but also legal, financial, and reputational impact.

From an underwriting perspective, the market has become more selective. Insurers/Reinsurers are placing greater emphasis on:

• Control verification rather than declarations
• Policy wording clarity and sublimit structures
• Aggregation management and systemic exposure
• Enforcement of security-related conditions

Capacity remains available — but increasingly for well-managed risks. Organisations with weak controls are facing higher retentions, sublimit on first-party coverages, or more restrictive terms.

For brokers and insureds alike, the message is clear: cyber insurance is no longer a transactional purchase. It requires informed structuring, realistic expectations, and alignment between coverage, controls, and exposure.

The current soft cycle offers an opportunity. Businesses that strengthen their cyber posture and secure appropriate limits now will be better positioned if market conditions tighten following a systemic event.

At EllGeo Re, we continue to work closely with our partners to structure cyber reinsurance solutions that reflect today’s evolving threat environment — not yesterday’s assumptions.

Written by Parvesh Boolaky, Reinsurance Broker at EllGeo Re.