Munich Re invests in cyber-risk coverage

Munich Re intends to be more involved in the cyber-risk coverage. The earned premium volume in 2018 amounts to 500 million USD. To date, the results of this activity are profitable, which boosts the German reinsurer to adopt a more «aggressive» approach in the future.

The ultimate goal is to retain 10% of the portfolio and maintain the combined ratio within a range of 60-80%. Munich Re estimates its maximum exposure to a cyber incident to 1 billion EUR (1.14 billion USD) which stands at the scale of a medium-sized natural disaster.

In contrast, Swiss Re, Munich Re’s direct competitor, is being cautious. The latter considers that the risk of cumulation is very high and that the current rates are too low for it to enter the market.