SMEs still underestimate the potential impacts of hack attacks, amid a wider cyber protection gap, Munich Re says.

Closing this gap and strengthening resilience to cybercrime is not just a strategic imperative for the insurance industry but a critical societal responsibility, according to the reinsurer.  

“Over the past 10 to 15 years, cyber insurance has experienced remarkable growth, evolving from a virtually non-existent product to a global market with approximately €15 billion ($27 billion) in premiums today,” Munich Re Europe cyber leader Claudia Strametz said.

“Despite this progress, less than 5% and possibly as little as 1% of cyber risks are currently insured, and cyber insurance still only accounts for less than 1% of the total property and casualty insurance market.” 

The reinsurer says SMEs underestimate the “existential threats” of a hack. 

Munich Re says it continually enhances its expertise by investing in advanced modelling capabilities and specialised cyber teams.

The reinsurer has also warned of rising complexity in international exposures for European programs.

Examples include the impacts US litigation can have on European companies, even if they do not have a large subsidiary in the States. 

Munich Re was commenting last week ahead of the annual reinsurance gathering in Baden-Baden, Germany, which started yesterday.