Emerging Asia is ripe for more personal cyber insurance
The increasing pace of digitisation, rapid proliferation of data-collecting devices, and fast adoption of innovative technologies are adding strong momentum to emerging Asia’s productivity and economic growth. However, the risk of cybercrime is also on the rise. Cybercrime encompasses a broad spectrum of illicit activities from cyberbullying to identity theft and commercialised privacy.
A study by Peak Re shows that many emerging Asia consumers have experienced cybercrimes themselves. Personal experiences and heightened risk awareness are adding up to an increasing acceptance of personal cyber insurance products.
Expanded scope and complexity
The scope of cybercrime has evolved over the past decade from crimes against computers and information systems to encompass a much broader spectrum of illicit activities. The widening scope and scale of cybercrime renders a formal categorisation almost impossible. The common activities include botnets, identity theft, cyberstalking and cyberbullying, phishing, internet fraud and ransomware attacks.
According to one estimate by Cybersecurity Ventures, cybercrime is predicted to inflict total economic losses of $8 trillion globally in 2023 (equivalent to $255,000 a second, or $21.9 billion a day). Losses are projected to trend on a steeply rising trajectory, reaching $10.5 trillion annually by 2025.
Asia is particularly vulnerable to cybercrime due to its fast digitisation and increasing reliance on mobile technologies. Some markets are facing the challenge of having security infrastructure in place or updated to match the fast-evolving tech landscape. It wasn’t too long ago that the term “cyber five” was coined to denote the vulnerability of Singapore, Australia, Japan, New Zealand and South Korea to cyber attacks due to their heavy reliance on technology.
A limited range of mostly corporate cyber insurance products is available in the Asia marketplace, but there are no reliable figures on the size of the market. Best estimates suggest the premium pool is likely to be within $500 million given the high level of under- and noninsurance of cyber risks in Asia. In particular, the lack of mandatory notification and other cultural factors highlight the need for transparency in the market.
The consumer experience
To better understand the prevalence of cyber attacks and awareness of cybersecurity issues, Peak Re conducted a large consumer survey covering five emerging Asian markets in July/August 2023. The five markets are India, Indonesia, Malaysia, the Philippines and Thailand. Samples are selected based on household income to focus on the “middle-class”.
The full report, covering a range of key insurance topics, including mental wellness, critical illness, and cybersecurity, will be available on Peak Re’s website in November 2023.
Below are some of the key findings
