CyberCube, a provider of cyber risk analytics for the insurance industry, has released new research showing how diversification and mitigation strategies can materially reduce exposure to catastrophic cyber events.
Based on analysis using CyberCube’s Portfolio Manager v6 (PM v6) catastrophe model, the report demonstrates that diversification across geography, industry sector, company size, and technology can reduce modelled losses by up to 42%. According to CyberCube, the cyber hygiene of insured organisations is equally critical.
Practices such as patch management, network segmentation, and strong backup systems can cut tail risk losses by as much as 57%, with even greater reductions during ransomware-driven events.
Jon Laux, Vice President of Analytics at CyberCube, commented: “The cyber insurance market has experienced rapid and sustained growth over the past several years, emerging as a catastrophe (CAT)–exposed and capital-intensive line of business.
“This trajectory, while promising, heightens the need to understand the role of diversification and risk mitigation—two themes that have been extensively examined in natural catastrophe insurance, but remain comparatively underexplored in cyber.”
The report, Reducing Cyber Catastrophe Risk: Diversification and Mitigation in Action, also emphasises the concentration of exposure within the United States.
CyberCube notes that US-based companies represent roughly two-thirds of the global cyber insurance market, while many Single Points of Failure (SPoFs)—such as operating system and cloud service providers—are also concentrated in the US. This reliance heightens systemic vulnerability.
However, CyberCube projects that the growing maturity of European and Asian insurance markets will gradually reduce this concentration. As these regions expand, insurers will be able to spread exposures more evenly and strengthen resilience against major loss scenarios.
In July 2025, CyberCube launched the latest version of Portfolio Manager, PM v6, incorporating research and feedback from cyber specialists across the industry.
The insights published in Reducing Cyber Catastrophe Risk: Diversification and Mitigation in Action provide the context for these model updates, supporting insurers in preparing for catastrophic cyber threats.
The full report is available from CyberCube.
The post CyberCube report shows diversification and mitigation can reduce cyber losses by over 50% appeared first on ReinsuranceNe.ws.
