US Cyber Insurance Market Sees Flat Premium, More Third-Party Claims Hit Loss Ratio
The U.S. cyber insurance market may be facing a time of transition as certain signs point to eventual adverse development.
According to AM Best, the market’s loss ratio in 2025 increased for the second straight year to 53—the first time over 50 since the ransomware spike seen during the COVID pandemic.
In the meantime, third-party claims are rising and total premium was basically flat after considering that a perceived increase in 2025 was caused by insurer Beazley’s move of a block of business from an offshore entity to the U.S.
Chubb occupies the top spot among largest cyber insurers but Zurich’s acquisition of Beazley will make it the top cyber insurer based on 2025 direct premiums, AM Best noted.
Prices are still going. AM Best’s cyber market report said the first three months of 2026 saw the eighth consecutive quarter of pricing cuts in the U.S. cyber insurance market.
“As long as pricing continues to decline, insurers will have difficulty reversing the increasing loss ratio,” AM Best said.
Related: Doing its Job: Large Majority of Cyber Losses Covered by Insurance, Says Willis
Third-party claims, which are trending up 30%, will add to uncertainty of future losses because they typically have a longer tail. Surplus lines carriers are in line to take a direct hit, since they now account for nearly two-thirds of all cyber insurance premium, AM Best said, and already had an incurred loss ratio of nearly 56 in 2025. Admitted carriers carry a loss ratio of 50.2. (The paid loss ratio remains in favor of surplus lines.)
AM Best said the marketplace is becoming two markets, with surplus lines writing primary and excess cyber-specific policies and “another market focused on endorsements to other commercial policies.” However, with surplus carriers looking to take the brunt of long-developing third-party claims, the “paid-loss advantage for surplus lines carriers may dissipate and possibly even turn the other way,” AM Best added.