By Mary-Anne Firneno, Research Manager, Insurance Information Institute
Americans have embraced the Internet of Things. As consumers own more internet-connected devices and buy more products online and businesses use more electronic data and online storage, cyberattacks continue to occur.
Despite reports of ever-larger data breaches, awareness of the protection available to consumers through insurance has shrunk over the past year, according to a survey from the Triple-I and J.D Power.
The 2020 Consumer Cyber Insurance and Security Spotlight Survey℠: Consumer indifference is still a challenge for personal cyber insurers, found that only about one in 10 American consumers who have connected devices in their homes or vehicles say they have insurance to help them recover from a cyberattack. And close to half do not know whether they have this protection. Fewer connected device owners say they have cyberrisk insurance than when the Triple-I and J.D. Power polled them in 2018.
Yet consumers are interested in cyberrisk insurance. More than half of connected-device owners (56 percent) said they believed homeowners or auto policies should offer cybersecurity coverage.
So why don’t more consumers buy cyberrisk insurance? The 2020 Consumer Cyber Survey found that three-quarters of connected consumers are reluctant to pay more for cyberrisk coverage – despite the fact that cyber coverage is relatively inexpensive: about $10 from a package policy and about $40 for a separate one.
Persistent attitudes that cyber coverage is a not a product consumers are willing to purchase is an opportunity for insurance professionals to explain the value of personal cyber coverage.