Big companies including banking giant JPMorgan Chase have reduced the amount of cybersecurity insurance they buy from major underwriters, according to people with direct knowledge of the situation. The moves came after ransomware and other digital hacks blindsided insurers, triggering payouts to customers nearly equal to the premiums the companies collect. In the past year insurers have dramatically increased premiums and narrowed the potential losses they would cover.
As a result, some customers are balking. Major software firms and retailers have either nixed or are considering ditching cyber insurance, according to security and insurance executives. The move away from traditional insurance firms is a reversal from recent years, when businesses purchased it as a hedge against attackers who have increasingly taken over corporate IT systems and demanded ransom payments in exchange for handing back control.
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