Cyber Insurance Growth Hindered More by "Executives' Lack of Awareness" Than Premium Costs

The Korea Fire Protection Association announced the results of its “2026 Survey on Cyber Risks and Insurance” on October 15. A total of 82.7% of respondents said the domestic cyber insurance market relies on legally mandated insurance. Meanwhile, 83.6% said insurance coverage levels are low relative to the cyber risks companies face. Among the main factors constraining market growth, 66.4% cited executives’ low awareness of cyber risks, a higher proportion than the 10% who pointed to the cost of premiums.

The survey was conducted among 110 experts in related fields, including insurance and reinsurance, cybersecurity, financial institutions, and academia, to identify constraints on the growth of the domestic cyber insurance market and areas for institutional improvement.

Regarding cyber risk management systems, 82.3% of respondents said risk management is currently overly focused on IT departments. A total of 91.7% said cyber risks should be managed as part of enterprise risk management (ERM), encompassing financial losses, legal liability, business interruptions, and other risks.

In addition, 94.1% of respondents agreed that cyber insurance policy terms and risk assessment models need to be standardized. Many also said cyber insurance should evolve beyond simple compensation for losses to include advance risk assessments and accident prevention.

A total of 89.4% of respondents said the government and private sector should jointly share risks that are difficult for private insurers to cover alone, such as state-sponsored cyberattacks and infrastructure shutdowns.

A Korea Fire Protection Association official said, “Taken together, the survey results show that strengthening the market infrastructure, including the collection and sharing of incident data and the standardization of risk assessment systems, is an important task for revitalizing the domestic cyber insurance market.” The official added, “The survey also confirmed the need to strengthen companies’ risk management capabilities and expand the practical use of cyber insurance by enhancing its preventive functions and promoting public-private cooperation.”

The association plans to share the survey results on its general insurance platform, BRIDGE, and in its webzine, among other channels, and work with the insurance industry to explore ways to standardize cyber risk assessment systems and make use of insurance.

This content was produced with the assistance of AI translation services.