In an industry first, insurance firm announces cyber bond to cover claims over $300 million

London-based insurance company Beazley said it is launching the first cyber catastrophe bond, as concerns grow in the industry about the increasing financial fallout from cyberattacks. 

Under the arrangement, the $45 million bond will pay out to Beazley if a cyberattack costs its clients more than $300 million. Absent such an event, Beazley will make interest payments to the bond’s investors, which include Fermat Capital Management, and will eventually return the principal on the loans.  

Such insurance-linked securities (ILS) have …

beazley capital catastrophe claims clients cyber cyberattack cyberattacks cyber bond cyber catastrophe bond event fermat financial industry insurance interest investors london pay payments under