Take Advantage of the Cyber Boom:
JOE: As the fastest growing type of coverage, cyber insurance is creating significant opportunities for both brokers and insurers. More organizations are realizing the possible consequences of a cyber breach and as a result, brokers have a good opportunity to grow their books of business. To find out more about the cyber insurance space, we caught up with Shane Roney, from Trisura.
SHANE: I think most of the companies that are buying cyber insurance, it’s driven by regulatory or contractual requirements at the moment, so as the regulatory environment in Canada evolves, I think we’re going to see more people starting to buy it. A combination of those two and then people that are familiar with corporations that are similar to theirs that have either had threats or actual cyber incidents occur, I think are the ones who have the fastest and most uptake in the cyber insurance market.
There’s a variety of different policies, there’s the stand alone cyber policy which has the 3rd party and 1st party coverages, as well as a variety of endorsements onto other specialty lines policies that provide a combination of mostly 1st party, but some 3rd party coverages as well. So, a lot of different insurance companies are approaching it in several different ways in order to really try and find the sweet spot with the consumer to really see how they want to be able to purchase the coverage.
Well there’s certainly a lot of growth and demand. And whenever there’s a lot of growth and demand it creates an opportunity for suppliers to come in and create more supply so we’re starting to see the demand grow a little bit faster than the supply which is creating new entrants into the market. There’s certainly a lot more choice for purchasers of cyber insurance today than there was just a couple years ago.
What brokers really need to do to be able to expand their business is really become an expert. They need to be able to speak the language that the IT department speaks as well as the language that the underwriting department speaks and be able to translate between the two of them. So that they can explain what the underwriters are looking for to the IT departments of their clients and then they can explain what the IT departments are saying to the underwriters so the underwriters have the best understanding of the risk, and can accurately price it, put accurate deductibles on it and make sure that the coverage is as broad as possible for their clients.