Bermuda captives writing cyber risk experienced the greatest year-on-year percentage increase out of any line of business in the market in 2017, according to the BMA Captive Report 2018.
Captives wrote $42 million of cyber risk premiums in 2017, an increase of $26.3 million from $15.7 million in 2016, doubling the total premiums written.
Cyber has been lauded as one of the fast growing lines in insurance. Captives can play a meaningful role in how the risk is managed, for example being used to tailor specific coverages, lowering the cost of risk and keeping insurance programmes consistent in the process.
While cyber coverage has typically been bought by large data holders - financial institutions, retail companies and healthcare companies - companies that do not carry personal data, but have critical technology in their supply chain may be subject to business interruption exposures or even physical damage.
Although cyber experience the greatest year-on-year increase in premiums, the provision of property coverage represented 53 percent of all business written by Bermuda captives in 2017 (compared to 55 percent in 2016).
The main property lines in 2017 included property and casualty catastrophe (43 percent), warranty and residual value (21 percent), and property damage and business interruption (15 percent).
Bermuda captive also wrote around 47 percent of all business in casualty lines in 2017 compared to 45 percent in 2016. Primary casualty lines for 2017 were general liability (26 percent), workers' compensation and employers liability (24 percent), and motor (20 percent).
BMA highlighted that significant year-on-year percentage increases were seen in professional liability (2017- $2.1 billion; 2016- $0.7 billion) and general liability (2017 - $3.6 billion; 2016 - $2.5 billion) lines.
BMA, Report, Captives, Cyber, Bermuda