Insurance is a critical risk transfer tool, long relied upon by companies to transfer cyber risk away form the balance sheet.

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Insurance is a critical risk transfer tool, long relied upon by companies to transfer cyber risk away form the balance sheet. Unfortunately cyber has become a significant risk to both insurers and insured. Insurers are tightening policy wording, introducing exclusion clauses and caps. Those seeking cyber insurance also need to bare some burden for cyber risk management. Where once companies relied upon insurance to cover cyber risk, they now have to consider how they can demonstrate management of cybersecurity and risk.

The EU is introducing cyber regulations, that come into effect in 2025, effecting CNI providers (including Gas). Regulation that requires many CNI providers demonstrate their governance, oversight and assurance of cybersecuirty risks. regulation that transfers cyber risk into the board room of covered entities.

“Lack of models to accurately assess risk and lack of consistency in terminology and coverage have created a lot of friction in the cyber insurance market,” said Rep. Eric Swalwell, D-Calif. “These dynamics have created a perfect storm, demand for cyber insurance has increased, premiums have gone up and some insurers are reluctant to write policies. So we are in a unique position to bring certainty and stability to the market.”

It is now time for cyber (and DAO) insurers and clients to develop solutions that manage cyber risk transfer between both parties. Where both parties can demonstrate appropriate oversight and assurance of cybersecurity risk to each others satisfaction. Cyber risk is here to stay and is only going to increase in frequency, complexity and severity.

@Thaddeus Dziekanowski Brian D. McCarthy Rachel V. Rose, JD, MBA Ryan Buckner

Veritas GRC

#cybersecurity #cyberriskmanagement #cyberinsurance

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