Insurance Journal examined industries experiencing changes, challenges, expansions and growth in the past year and picked the top five market sectors that could offer opportunities for agents and brokers in the property/casualty insurance industry in 2017. Each market will be detailed on MyNewMarkets.com. over the coming days.

Belle of the Market Ball

For the umpteenth year in a row, cyber insurance is the belle of the market ball. Carriers are pumping out new cyber insurance products and enhanced policies with breach prevention and response services at a rapid pace, with new products or enhancements coming out almost daily.

But the question remains for this market: is anyone buying them? The answer seems to be yes; the take-up rate for cyber

policies has grown every year, but there are indicators that the pace might be slowing. A 2016 survey from Zurich and Advisen of 345 U.S.-based risk managers, insurance buyers and other risk professionals covering both large and small companies, shows that over the last six years the proportion of companies buying cyber insurance increased by 85 percent.

However, the proportion of companies buying coverage in 2016 was up only 7 percent from 2015, compared to an 18 percent increase in 2015 over 2014.

Still, there is increasing awareness for the need for cyber coverage - 87 percent

of the survey respondents believe technology interruption would have a moderate-to-significant impact on their business - which the insurance industry hopes will turn into increased demand.

An article from Marsh & McLennan Cos. Global Risk Center said total annual cyber premiums have reached an estimated $2 billion and may reach $20 billion by 2025.

The biggest growth area may be in the realm of the Internet of Things (IoT), which could open the door for a personal lines cyber market. From smart phones, to smart watches, to smart TVs, and even internet-connected thermostats, people are constantly connected and so is their personal data.

According to a survey from the Hartford Steam Boiler and Inspection Co. (HSB), eight out of 10 U.S. consumers have a home data network and more than a third of them connect entertainment systems, gaming consoles and other smart devices to the internet. With all of this connectedness comes increased risk of home cyberattacks.

The HSB survey said that while cyberattacks on non-computing home systems and smart appliances have been relatively uncommon so far, the increase connectedness is luring hackers and cyber thieves that are looking for new targets.

"Home devices like smart TVs and appliances are often designed for easy use and not security," said Timothy Zeilman, vice president and counsel for HSB. "Compounding the problem, many consumers don't take even basic measures such as changing default passwords and updating security software."

HSB said that damage to home devices in a cyberattack could result in a substantial financial loss - typically between $1,000 and $5,000.

A report by Aon company Stroz Friedberg called "2017 Cybersecurity Predictions" listed the IoT as one of the top cybersecurity threats for 2017.

The report said that insurers are beginning to respond with cyber insurance coverages for individuals that reimburse for expenses related to cyberattacks on home computers, home systems, and appliances and other connected devices, cyber extortion, data breach and online fraud. The business community's risk is even greater, as employees increasingly turn to less secure devices outside of their office to conduct business.

There will be a "necessity to accept that cybersecurity risk management is a critical part of doing business," according to the Stroz Friedberg report.

Check back tomorrow for more on the emerging risk of active shooter coverage...