Page 17 - Insurance Times August 2021

market, the proportion of consumers Those that have gone even further by reveals that cybersecurity was thrust
seeking out comparison services was gamifying or innovating cover will be into the spotlight in 2020 as the
much higher at 31.6%. GlobalData's the ones to further benefit." COVID-19 pandemic forced businesses
2020 survey also found that financial These include fully digital insurtech to digitize their processes and adopt
savings are increasingly becoming a key DeadHappy, which offers pay-as-you- remote working practices overnight.
priority for term assurance customers, go term assurance. Its application pro- The pandemic also presented an oppor-
with 69.1% of consumers that would cess invites customers to create a tunity for cybercriminals to exploit glo-
consider wearing an activity tracker 'deathwish' - something that makes bal panic, with a surge in cyberattacks
and exchanging that data with a life the process more light-hearted and occurring in 2020. This has made the
insurance company only doing so for engages with a younger audience who need for cyber insurance apparent to
financial rewards, up by 18.6 percent- do not normally think about death. In businesses, but the market is not as
age points (pp) compared to 2019. addition, fully digital insurtech Bequest easy to navigate as it once was.
Jazmin Chong, Insurance Analyst at launched a pay-as-you-go term assur- Ben Carey-Evans, Insurance Analyst at
GlobalData, comments: "These find- ance policy in July 2021, providing in- GlobalData, comments: "The cyber
ings illustrate how consumers are be- stant cover that targets parents and insurance market has seen rapid ex-
coming increasingly self-reliant and fi- families. Bequest has rapidly captured pansion in recent years, with custom-
nancially conscious, especially when it venture capital investment interest, ers enjoying high coverage limits, flat
comes to term insurance policies - a securing £1.7m in seed funding upon rates, and abundant capacity as insur-
market that is heavily tied to the mort- launching its new product. ers sought to capture business in a
gage market. Despite this, non-mort- Chong adds: "If insurtechs are able to highly competitive market. Despite
gage-related was the only term assur- successfully streamline their protec- lower cover limits and increasing pre-
ance product to record an increase, up tion onboarding - delivering a smooth miums, we expect the cyber insurance
2.2% in terms of new contracts sold in claims process while providing the fi- market to see continual strong year-
2020. Meanwhile, contracts sold in the nancial flexibility they are promising - on-year growth up to 2025. The need
mortgage-related term assurance then they will be setting a new stan- for robust cybersecurity and cyber in-
market contracted by 5.1% for the dard for service delivery and meeting surance is becoming apparent to busi-
year. Going forward, GlobalData fore- consumers' newly established de- nesses of all types and sizes, as the fre-
casts that new contracts for mortgage mands. Similarly, usage-based-insur- quency and severity of cyberattacks
and non-mortgaged-related term will ance in personal motor has become continues to rise."
grow by 4% in 2022." increasingly popular among consumers The market recorded growth of 33.5%
Growth in the term assurance market due to the impact of the pandemic and in 2020 as businesses around the world
for the next five years will be driven by has resulted in incumbent insurers like realized the increased threat COVID-
both an economic recovery and the Covea partnering with insurtech By 19 and staff working from home posed.
removal of COVID-19 underwriting re- Miles in order to continue reaching The growth rate is set to remain high
strictions. Even more importantly, a customers." throughout the forecast period, with
greater number of consumers will pur- GlobalData projecting a rate of 27.3%
chase term assurance policies because Cyber insurance industry growth in 2021.
the pandemic has illustrated the nega- Carey-Evans adds: "COVID-19 has also
tive impact of unprecedented events. to exceed $20bn by 2025 brought about a permanent shift in the

Ensuring family members are pro- The global cyber insurance market was way businesses and consumers oper-
tected upon death remains the key worth $7bn in gross written premiums ate, with remote working practices set
driver leading to purchases in the term (GWP) in 2020 and will reach $20.6bn to stay and digital consumer channels
assurance market. by 2025, as the market will continue seeing more use than before the pan-
Chong continues: "Insurers that have to thrive post-COVID-19, according to demic. This lasting shift in behavior will
already adapted to the fluctuating GlobalData, a leading data and push the demand for both commercial
market environment - including AIG analytics company. cyber insurance and to a lesser extent
Life, BGL Group, and Aviva - will be GlobalData's report, 'Cyber Insurance, personal cyber insurance in the com-
less impacted by consumer changes. 2021 Update - Thematic Research', ing years." T

The Insurance Times, August 2021 17