Cyber protection gap widens as digital dependence grows

Asia-Pacific accounts for just 10% of worldwide premiums compared with 65% for North America.

Artificial intelligence (AI) and insufficient policy limits are becoming key risks for the cyber insurance market as digital dependence grows, according to Swiss Re’s latest annual cyber report.

Swiss Re said AI is mainly increasing existing cyber risks rather than creating entirely new types of insured losses. 

Global cyber premiums are estimated at $16.4b in 2026, with the market growing at a compound annual rate of about 5% since 2022.

Cyber insurance rates have fallen for four consecutive years, although the decline eased from 13% in 2025 to 5% in 2026.
North America accounts for 65% of global cyber premiums, followed by Europe at 21% and Asia-Pacific at 10%.

Threat actors are using the technology to identify vulnerabilities faster, automate attacks and improve phishing, whilst businesses are deploying it for threat detection and incident response.

AI-related cyber claims remain limited, but insurers and reinsurers will need to monitor emerging loss trends and clarify how existing policies respond as exposures develop, Swiss Re said.

Underinsurance is another concern, particularly amongst large companies. Severe ransomware attacks and data breaches can generate losses well above current policy limits through business interruption, restoration costs, supply-chain disruption and lost revenue.

Swiss Re said an average of 10 large cyber losses a year over the past five years would have exceeded the average policy limit of $120m. 

In some cases, companies may need to double their current limits, depending on their operations, location and risk profile.

Smaller businesses also remain a major protection gap. Micro, small and medium-sized enterprises are still largely uninsured, despite representing an estimated $4.9b in potential premium in 2026.