Allianz: 14% Increase in Large Cyber Claims, Driven by Data Breaches and Privacy Violations
Cyber claims are continuing their upwards trend over the past year, with the frequency and severity of large cyber claims up 14% and 17% year-over-year in the first half of 2024.
Allianz Commercial’s annual cyber risk outlook also shows that data and privacy-breach related present in two thirds of those large losses.
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Other recent reports show rises in certain cyber events, such as a rise in “non-attack” data privacy claims, attributed to advancements in technology. Data breaches have become a surging area of class litigation in the U.S., with more than 1,300 cases filed in 2023. A Corvus report found that ransomware operators are finding new methods to secure bigger paydays from organizations.
These cases span across multiple industries, including social media, healthcare, and entertainment streaming services. Despite increased investment in cyber security in recent years, many data breaches are occurring due to weak cyber security within organizations, according to the reports.
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According to Allianz, data breach is the cyber exposure of most concern (pg. 5). Data breaches account for 59% of risks reported by respondents to their survey. Nearly half (53%) are concerned about cyber-attacks on critical infrastructure and physical assets, and the same percentage of respondents worry about increases in malware and ransomware attacks.
Ransomware remains the top cause of cyber losses. In the first six months of the year, that accounted for 58% of the value of large cyber claims, the report shows. It also shows the frequency of attacks grew by 75% in 2023.
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There were a record 3,205 data breaches in the U.S. in 2023, affecting 353 million known victims. The cost associated with these breaches also reached new heights, with the average global cost reaching an all-time high of $4.9 million in 2024, a 10% increase from the previous year, the report shows.
The number of U.S. companies impacted by supply chain attacks tripled in the first quarter of 2024, with roughly 40% of those breaches spanning multiple environments such as public and private clouds.
Over the last year, data breaches have emerged as one of the fastest growing areas of US class action litigation. More than 1,300 were filed across a range of data privacy regulations in 2023, more than double the number in 2022 and four times in 2021, the report shows.