US insurance leaders expect significant commercial lines growth this year, with cyber covers leading the way.

More than half (55%) of respondents to the Insurance Information Institute (III) Industry Leader Trends survey say commercial lines will grow more than personal lines, with 88% predicting cyber will outpace the rest.

“This is not surprising given businesses within personal data-driven industries such as healthcare, finance and banking, retail and communications view cyber risk as a real threat,” III Senior VP and Chief Economist Steven Weisbart said.

“Growth in the cyber insurance market will also be driven by increasing demand for business interruption coverage.”

When asked what issues are most important to property and casualty insurers, 43% of respondents focus on attracting the next generation of talent and skills.

About 23% say technology is a concern, with another 23% drawing attention to regulation of insurance companies and associated costs and complexity.

Leaders were also asked to pinpoint the key cause of mergers and acquisitions activity, with half highlighting the need to achieve economies of scale.

“Size can bring economies of scale when certain costs, such as regulatory costs, are increasing,” Dr Weisbart said. “Companies are also concerned about the need to diversify across product lines. Lack of diversification could result in highly volatile earnings and decreasing profitability for insurers.”