Dr Michael Neary, industry general manager for insurance at international IT firm CSC, said that insurers need to work with brokers when it comes to cyber cover to ensure that clients are protected.
“A lot of brokers and advisers are right at the front-end so the insurers need to make sure that their brokers and advisers are across the topic and understand it at the same level as they would any of the other insurances. Then they take that out to their consumers, the small businesses that they help to insure and make sure that they lift their level knowledge,” Dr Neary told Corporate Risk & Insurance.
“Clients of the brokers, and clients of insurers, are really feeling their way and they are going to need advice about the risk and the types of policy that can mitigate that risk and also what can they do to take their risk level down.”
Dr Neary noted that while “pockets of awareness” are growing around cyber insurance, more needs to be done to educate those in the insurance industry as well as business owners and board-level staff looking to purchase cover.
Partnerships between insurers or brokers and the cyber security industry will be “absolutely critical” for the development of cyber insurance, Dr Neary continued, as insurance looks to play a traditional role in an emerging risk area.
“Just as insurers are comfortable sending people off to a doctor or getting in surveyors or valuers – it is just the same type of partnership required,” Dr Neary said.
“A partnership where someone can come in with experience and say ‘here are all the risks’, and the insurer then makes the pricing decisions and policy decisions around that but works in partnership with experts.”
The next 12 months will be key for the cyber market, Dr Neary said, as awareness continues to grow and the cover matures over the next decade. Dr Neary said that cyber should be treated in a similar way to other policies that are vital for businesses.
“The insurance industry has always fulfilled those societal obligations of spreading risk and helping businesses be more resilient and this is just the next evolution on that,” Dr Neary continued.
“It shouldn’t be seen as a discontinuity, which I think it is now, but as part of a continuous journey of helping businesses manage their risks.”
Insurers should look to support brokers on the sale of cyber insurance as awareness of the cover continues to build throughout the business community.