Munich Re has agreed to buy At-Bay, a cyber-insurance startup, for $575mn. The deal values the company at less than half what it was worth in 2021. The German insurance group announced the acquisition on Wednesday, in a statement.

The price is a reset. At-Bay was valued at $1.35bn in its last funding round in 2021, according to Calcalist’s CTech. The $575mn enterprise value is well under that. CTech linked the drop to tougher conditions in the technology and insurance markets since then.

The deal is due to close in the first quarter of 2027, subject to regulatory approvals and customary conditions, Reuters reported. At-Bay will sit inside Hartford Steam Boiler, Munich Re’s cyber-focused specialty unit. The move is a rare large acquisition in the insurtech sector, which has cooled since its 2021 peak.

What At-Bay does

At-Bay mainly sells cyber insurance to small and medium-sized businesses. It pairs that cover with its own security software, an approach it brands “InsurSec”, short for insurance and security. The idea is to prevent attacks in the first place, not just pay out after them.

The platform continuously watches a customer’s cyber exposure over the life of a policy. It uses what it finds to reduce the customer’s risk, and to sharpen its own underwriting, the company said. That data loop is the pitch: fewer claims for the insurer, and fewer attacks for the client. It is the same prevention-first logic that has drawn investors to digital insurers elsewhere.

The company was founded in 2016 and is based in the United States, though its roots are Israeli, according to CTech. Munich Re dates the firm’s launch to 2017. It employs about 280 people across the US and Israel, the release said. Munich Re said it is a top-10 US cyber insurer, with gross written premiums of $278mn. At-Bay says it protects close to 40,000 businesses in the US and covers up to $800bn of their combined revenue.

Why Munich Re wants it

Munich Re framed the deal as a bet on where cyber cover is heading. The market is shifting from standalone policies towards platforms that bundle insurance with security, it said. Munich Re wants a bigger place in that shift.

Small firms are the target. They face the same threats as large companies but often lack the staff and tools to defend themselves, Munich Re said. At-Bay serves close to 40,000 US businesses, according to the company. Beyond cyber cover, it also sells technology and professional-liability policies, and a managed detection-and-response security product.

At-Bay is “a perfect addition to our specialty insurance portfolio,” said Mike Kerner, a member of Munich Re’s board. He said he expected the business to become a strong earnings driver over time. Munich Re already sells standalone cyber cover, and framed At-Bay as the piece that adds continuous risk management on top.

Hartford Steam Boiler has backed At-Bay since its early days, the two companies said. Its chief executive, Jeffrey O’Shaughnessy, said the deal would connect insurance, security and claims into one continuous system.

A hard road to the sale

The exit follows a difficult stretch for At-Bay. Changes in the insurance market and rising interest rates weighed on the company, CTech reported. It laid off staff, including a large part of its development team in Israel.

The startup has raised about $276mn since it was founded, CTech reported. That makes the $575mn price a modest return over the money put in, rather than the windfall a $1.35bn valuation once implied. Its co-founder and chief executive, Rotem Iram, cast the sale as a way to scale rather than a retreat. Joining Munich Re will help At-Bay “close the cybersecurity protection gap for the 90% of businesses being left behind,” he said.

The lower price still marks a comedown from its 2021 peak. It echoes a wider reset in startup values, seen this week in the Indian fintech Navi’s raise below its earlier target. Money that once flowed freely into growth-stage tech has since grown far more cautious.

Munich Re’s buying spree

The deal is Munich Re’s second big move on an Israeli-founded insurtech. In March 2025, its ERGO arm bought the rest of Next Insurance for about $2.6bn, CTech noted. The two purchases deepen the group’s ties to Israel’s insurance-technology scene. Munich Re and its ERGO arm had backed Next Insurance since 2017 before taking it over fully.

Munich Re is one of the world’s largest insurers, with insurance revenue of €60.4bn in 2025. It has pushed into newer risks in recent years, from rocket launches to renewable energy and cyber cover.

Cyber is a fast-growing but volatile line. Insurers have learned that a single large breach can drive heavy claims. That is part of why they want tools that cut losses before they happen. For Munich Re, buying At-Bay is a bet that owning the security layer, not just the policy, is the better way to profit from that risk.

The purchase is not yet closed, and the companies did not spell out how At-Bay would be folded into the group. What is clear is the direction: a large insurer buying a smaller, tech-led rival to move from paying for cyber losses to trying to prevent them. Whether owning the security layer lowers claims enough to pay off is the test ahead.

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