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I would welcome any thoughts on ‘cyber insurance shifts to a buyer friendly market’. Cyber is no longer a FUD debate, that pushed organizations to take on cyber insurance as a main risk transfer tool. It is a very real national security issue (see my previous post) that erodes national, corporate and economic security. That is continually transforming the nature of cyber threats, frequency and severity of attacks and the reliance on cyber insurance as a risk transfer tool.
Is cyber insurance a buyer friendly market due to rate reductions, coverage reduction or exclusion clauses? Cyber penetration rates are low (around 10-15%). Over 99% of organizations are SMEs, that cannot afford cybersecurity and may rely upon cyber insurance for the foreseeable future.
One wonders if exclusion clauses and limits cap the exposure cyber insurers have to cyber incidents, as the market aims to grow and increase gross written premiums and manage the effects of cyber loss calculations on regulatory capital.
Finally there’s cyber regulation. With the EU and U.S regulating cybersecurity, what will be the effects on the cyber insurance market, as cyber risk management is transferred left of bang to corporates. A transfer that will increase legal risk and enforce cybersecurity risk management compliance, with the aim of reducing the effects of cyberattacks. Will this effect D&O insurance as boards are held legally liable for cyber risk management compliance?
Ted Dziekanowski
#cyberinsurance #cyberriskmanagement #cyberregulation
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