An interesting article on retrocession insurance, as Swiss Re purchases the cyber market’s first retrocession industry loss warranty (ILW).

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An interesting article on retrocession insurance, as Swiss Re purchases the cyber market’s first retrocession industry loss warranty (ILW). The $50million ILW would appear to be a toe in the water for reinsurance, as the amount is not significant. But demonstrates another product for Swiss Re to balance up risks across its cyber book. It also a demonstrates of the complexity of building cyber risk management capital.

Question: Are insurers simply moving the chairs around on the deck of the Titanic. Transferring cyber risk from one insurer to the next, from one product to the next? If the cyber insurance market wants to grow as predicted, does it have to find a radical solution to covering claims capital and regulatory capital. Or find solutions to enable their insured clients balance risk transfer more effectively outside of insurance?

‘Right of Bang’ risk management has not been profitable for cyber insurers, and with the continued Y-o-Y increase in cyber attack frequency, complexity and severity may not be.

Ted Dziekanowski Brian D. McCarthy Rich Waite, M.Ed. George Sawyer

Veritas GRC

#cybersecurity #cyberinsurance #cyberriskmanagement #cyberregulation

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