Munich Re continues to believe strongly in cyber insurance despite a recent market slowdown. The potential is enormous, says Munich Re cyber chief Jürgen Reinhart. However, industry must learn how to become more attractive to currently uninsured companies through better products and distribution.

For more than a decade, Jürgen Reinhart has been leading Munich Re’s cyber insurance business. The trained mathematician and holder of a doctorate in aerospace engineering also serves as Deputy Chief Underwriter of the Munich Re Group.

Munich Re is currently exercising restraint in underwriting cyber risks due to low prices in the market. “We will probably record premium income this year at roughly the same level as last year,” says Reinhart, Chief Underwriter Cyber, in an interview with Börsen-Zeitung. However, he stresses that this is merely a pause: “The potential is enormous.” He adds that cyber insurance remains an attractive business if the right risks are selected.

The cyber insurance market in Germany is expected to grow by around 15% per year over the coming years, Reinhart estimates. “The market will double every five years. I think that is a very realistic assumption.” In the past, it even doubled approximately every three years. This year, the German cyber insurance market is expected to reach a volume of approximately USD 800 million. The global market is estimated at nearly USD 16 billion. According to Munich Re, it could reach around USD 28 billion by 2030.

Market Share Target of 10–15%

“Our ambition is to grow in line with the market,” says Reinhart—provided that the market remains rationally priced. Munich Re aims to maintain enough market share to influence the market meaningfully and is targeting a share of between 10% and 15%. Between 2015 and 2022, the company’s cyber portfolio grew by 35% annually. Reinhart states that Munich Re generated USD 1.7 billion in cyber insurance premiums in 2025, making it the market leader. Premium income is split equally between primary insurance and reinsurance. Munich Re employs around 200 specialists dedicated exclusively to cyber insurance.

According to Reinhart, cyber insurance is a predictable and profitable business. “Since assuming responsibility for these activities in 2015, we have generated a profit every year.” The company’s message to customers is that Munich Re will still be offering cyber insurance and cyber reinsurance ten years from now while continuing to generate sustainable margins.

Flood of Capital in the Market

Reinhart attributes the current abundance of capital in the cyber insurance market to several factors. First, he believes some providers underestimate how many losses only become apparent over the medium term. “We calculate these risks somewhat differently.”

Second, many market participants underestimate accumulation losses, which can occur when a single event affects many policyholders at once. According to Munich Re’s calculations, insurers should reserve 8–10% of premium income to prepare for such losses. Some competitors may instead count this portion as profit.

Third, insurtech companies, which command a significant market share, are under enormous pressure to grow. They increasingly package advisory services together with insurance policies and are often financed by venture capital. From the perspective of investors, company size at exit is often more important than profitability. Rather than developing innovative ways to reach new customers, many insurtechs attempt to win existing business through lower prices.

Reinhart also believes that insurers are directing capacity toward cyber insurance because other business segments have become less attractive. Some providers that were accustomed to annual growth rates of 35% may now pursue growth targets of 40–50% despite a slower market environment.

Nevertheless, the market is beginning to shift. According to Reinhart, several prominent market participants now consider the U.S. cyber insurance market unattractive from an insurer’s perspective. As a result, he expects prices to stop falling, although he is not yet predicting a hardening market. Since European rates began declining later than rates in the United States, Europe is likely to stabilize with a delay. However, conditions remain more attractive for insurers in Europe than in the U.S. He also notes: “Everything changes when a truly major loss occurs.”

Cybercriminals prefer smaller companies

What surprises Reinhart is how many businesses and individuals are still unaware of cyber insurance as a risk-management tool. “This is one of the biggest challenges facing the global cyber insurance industry.” In Munich Re’s Global Cyber Risk and Insurance Survey 2026, involving around 9,500 participants from 20 different markets, 89% of management-level respondents said they were not adequately protected against cyber risks.

For Reinhart, the conclusion is clear: there is substantial unmet demand for insurance coverage. This is also reflected in the small size of the market compared with the broader property and casualty insurance sector. In Germany, cyber insurance premiums account for only about 0.5% of total non-life premiums, while in the United States the share remains below 1%. “The potential is enormous.”

He believes that small and medium-sized enterprises (SMEs) in Germany are particularly vulnerable. Public discussion usually focuses on spectacular attacks against large corporations. However, cybercriminals primarily target smaller businesses with revenues below EUR 50 million—and often below EUR 10 million. “Around 70% of all cyber-attacks are directed at companies of this size.”

SMEs need different products

Given this demand, insurers must also accept part of the responsibility. “We are not really succeeding in reaching companies that currently do not have cyber coverage,” Reinhart says. One reason may be that existing products are not sufficiently attractive for SMEs. These companies require different protection than large corporations, simpler, less comprehensive, and therefore more affordable solutions. “We are probably offering products that are too complex and therefore naturally require higher premiums.”

A second challenge lies in distribution. “Brokers and agents still find it difficult to sell this product.” In Munich Re’s survey, one-third of respondents said they had never been offered cyber insurance. Another one-sixth were unsure whether they had ever received an offer.

According to Reinhart, the issue is not primarily commission levels. Rather, intermediaries worry they may be unable to answer customers’ questions about coverage in specific situations. This can create reputational risks if clients perceive them as lacking expertise.

Demand also exists among private individuals

Reinhart also sees significant demand for cyber insurance among private individuals. Munich Re generates around one-tenth of its cyber premium income from personal lines business and experiences relatively low loss ratios in this area. Growth potential is especially strong in Asia, where consumers rely heavily on digital services and therefore face elevated cyber risks.

Despite this, insurance penetration remains low. In China, for example, total cyber insurance coverage—including both corporate and personal lines—is estimated at only around USD 200 million nationwide.