Munich Re is acquiring the cyber-insurance company At-Bay for $575 million, which is half of its value from 2021.

      Munich Re has agreed to acquire At-Bay, a cyber-insurance startup, for $575 million. This valuation is less than half of what At-Bay was worth in 2021. The German insurance company announced the acquisition on Wednesday in an official statement.

      The price represents a reset for the company. At-Bay's valuation reached $1.35 billion during its last funding round in 2021, as reported by Calcalist’s CTech. The current enterprise value of $575 million is significantly lower, a decline attributed to tougher conditions in the technology and insurance markets since that time.

      The transaction is expected to be finalized in the first quarter of 2027, pending regulatory approvals and standard conditions, according to Reuters. At-Bay will operate within Hartford Steam Boiler, Munich Re’s specialty unit focused on cyber insurance. This acquisition is notable as a large-scale deal in the insurtech sector, which has cooled off since its peak in 2021.

      At-Bay’s Business Model

      At-Bay primarily offers cyber insurance to small and medium-sized enterprises. It combines insurance coverage with its own security software, a strategy it refers to as “InsurSec,” which stands for insurance and security. The aim is to prevent cyberattacks rather than merely offering compensation after an event occurs.

      The platform continuously monitors a customer's cyber exposure throughout the term of the policy. It utilizes the gathered information to lower the customer’s risk and refine its underwriting, as noted by the company. This data loop serves as the pitch: it leads to fewer claims for the insurer and fewer attacks for the client. This prevention-focused approach has attracted investors to digital insurance providers in various markets.

      Founded in 2016 and based in the United States, At-Bay has Israeli roots, according to CTech. Munich Re dates the firm’s establishment to 2017. It employs around 280 people across the US and Israel, as stated in the release. Munich Re identifies itself as a top-10 cyber insurer in the US, with gross written premiums of $278 million. At-Bay claims to protect nearly 40,000 businesses in the US, covering up to $800 billion of their combined revenue.

      Motivation Behind Munich Re's Acquisition

      Munich Re views the deal as a strategic move to align with future trends in the cyber insurance market. The market is transitioning from standalone policies to integrated platforms that combine insurance with security features. Munich Re aims to play a significant role in this evolution.

      The focus is on small businesses, which face the same cyber threats as larger firms but often lack sufficient resources for defense, according to Munich Re. At-Bay serves close to 40,000 US businesses, according to the company’s claims. Beyond cyber insurance, it also provides technology and professional liability policies, along with a managed detection-and-response security service.

      Mike Kerner, a member of Munich Re’s board, described At-Bay as an excellent addition to their specialty insurance offering. He anticipated that the acquisition would become a substantial driver of earnings over time. Munich Re already offers standalone cyber insurance, and At-Bay is viewed as a complementary solution that enhances ongoing risk management.

      Hartford Steam Boiler has supported At-Bay since its early days. Jeffrey O’Shaughnessy, its CEO, stated that the acquisition would create a seamless connection between insurance, security, and claims processes.

      Challenges Leading to the Sale

      The exit comes after a challenging period for At-Bay. Shifts in the insurance market and rising interest rates negatively impacted the company, leading to staff layoffs, including a significant portion of its development team in Israel, as reported by CTech.

      The startup has raised roughly $276 million since its inception, according to CTech. Thus, the $575 million sale price represents a modest return compared to the initial investment, rather than the significant profit suggested by a $1.35 billion valuation. Co-founder and CEO Rotem Iram portrayed the sale as an opportunity for growth rather than a step back. Joining Munich Re will help At-Bay “close the cybersecurity protection gap for the 90% of businesses being left behind,” he stated.

      The current valuation signifies a decline from its peak in 2021, reflecting a broader trend of resetting startup valuations, as seen recently with Indian fintech Navi raising funds below its prior target. The once-easy capital flow into growth-stage tech has become much more cautious.

      Munich Re's Acquisition Strategy

      This acquisition marks Munich Re's second significant investment in an Israeli-founded insurtech. In March 2025, its ERGO division acquired the remaining shares of Next Insurance for approximately $2.6 billion, as noted by CTech. These two acquisitions strengthen the group’s connections to Israel’s insurtech ecosystem. Munich Re and its ERGO division had been investing in Next Insurance since 2017 before fully acquiring it.

      As one of the world’s largest insurers, with insurance revenue of €60.4