Cyber risk modeling for insurers

The evolving nature of cyber risk is transforming the (re)insurance sector. In a fast-evolving threat landscape where data breaches, ransomware, and cybersecurity incidents are incurring unprecedented cyber losses and reputational harm, new approaches to risk management will be essential to help insurers capitalize on unprecedented growth opportunities and better manage cyber exposure.

Moody’s is a leader in delivering consistent cyber insurance risk quantification and pricing, with deep insights into both frequent and severe cyber risks. Our cyber risk modeling capabilities can help reinsurers accurately capture tail risk, diversify portfolios, and make more informed strategic decisions.

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Who we help
Case studies
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What we do

We offer an advanced and robust cyber risk modeling framework tailored to the (re)insurance industry’s distinct needs.

Improve strategic decisions

Quantify exposure across various coverages and gain detailed insights into cyber event frequency and severity.

Diversify portfolio risk

Integrate cyber insights across network intrusions, digital infrastructure outages, and physical losses to identify key risk drivers and areas for growth.

Maximize reinsurance capacity

Use a future-proof risk modeling framework to insightfully capture tail risk, enhancing your capacity and capital strategy.

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How we help

Understand the cyber threat landscape

Define various threat-actor profiles, motivations, resources, skills, and methods of operation.

Use attack vectors and loss mechanisms

Classify cyber loss processes, including their scalability, and determine the event size and footprint.

Analyze technology stack

Capture software families’ usage and reliance across industry sectors and company sizes.

Assess a business's cyber vulnerabilities

Analyze susceptibility to specific cyber events, considering both human and IT vulnerabilities and defenses.

Quantify, manage, and protect assets

Track the value of key revenue-dependent digital processes, data, and financial assets at risk.

Manage liabilities and minimize insurance losses

Calculate insurance losses considering coverage limits and deductible information.

Moody's Cyber Model

Unlock a sophisticated data-driven framework to analyze complex exposures and quantify systemic loss potential.

Who we help

01 Portfolio managers
02 Underwriters
03 Risk managers

01 Portfolio managers

Portfolio managers

Optimize portfolio steering and enhance diversification by leveraging detailed analyses at various levels such as coverage, account, portfolio, summary, or treaty. An extensive global database with over 20 million companies allows for thorough evaluation of potential security threats, risk profiles, and impacts.

02 Underwriters

Underwriters

Gain in-depth insights into key event risk drivers through comprehensive analysis of IT and cyber-physical perils, supported by year loss tables (YLTs), year event loss tables (YELTs), and exceedance probability (EP) curves. Tailor your analysis to align with your underwriting standards and pricing strategies to help gain a competitive edge in the complex cyber risk landscape.

03 Risk managers

Risk managers

Enhance your management of capital requirements and design effective risk transfer mechanisms. Our advanced risk framework models the real-world physics and dynamics of the cyber digital ecosystem, providing an insightful view of potential security threats and cyberattacks. By identifying key risk drivers and aggregation points, our model informs strategic decision-making in risk transfer and capital allocation.

Case studies

Models as a framework to understand cyber risk: A Gallagher Re story

Pioneering the Cyber Cat bond marketing: A Beazley story

Innovations in cyber risk modeling: An Aon story

News and views

press release

Sep 12, 2023

Moody's

Moody’s launches Cyber Industry Steering Group to facilitate growth potential of the global cyber insurance market

Munich Re, Gallagher Re, and Bitsight join as founding members of the Cyber Industry Steering Group.

article

Jan 02, 2024

Moody's provides modeling support to Beazley's $140 million cyber catastrophe bond

The bond is specifically crafted to provide coverage for catastrophic and systemic cybercrime events with a low probability of occurrence.

testimonial

First cyber cat bonds a watershed moment: Moody’s video interview

The successful issuance of the first full cyber catastrophe bonds in late 2023 was a watershed moment and the role of risk models in helping insurance-linked securities investors get up to speed on what is still a relatively new peril to the ILS sector was key, executives at Moody’s RMS told us in an Artemis Live video interview.

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Why Moody's?

Over 150 insights per day

More than 50 data sources

Over 200,000 articles

Covering more than 128 countries

Including insights on over 900 threat actors

Millions of cyber incidents (including DDoS)

Additional resources

Power of partnership: Moody’s and Bitsight work to address cyber insurance opportunities

With the cyber insurance market offering significant growth potential, (re)insurers are considering how to capitalize on this opportunity through prudent expansion of their underwriting capacity.

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