Cyber insurance, once considered "nice to have", is today poised to become a must in the new businesses created by the COVID-19 pandemic.
We are in a moment of great uncertainty. COVID-19 changed everything practically overnight. Companies sent entire workers home to work, and many brick and mortar companies quickly switched to e-commerce. These new realities present new questions and new risks.
A larger cyberattack area
Insurance companies need cyber insurance services to help customers mitigate new and expanding risk areas. The surface for cyber attacks has expanded exponentially. Six months ago, many companies may have worked towards models for teleworking. Now, in the wake of the COVID-1
I am intimidated to think of the proprietary business information that is flowing through home routers right now, with few or no security protocols. The security infrastructure built over the years in office settings may be completely absent. There are probably hundreds or thousands of routers that are used with "password" as the password or with no password at all.
Cyber insurance, although small compared to more mature industries, has grown steadily in recent years. According to Swiss Re, cyber premiums doubled between 2016 and 2019. Even before COVID, small businesses increased their e-commerce functions and largely drove this demand. Digital sales are now a matter of survival for many small businesses.
Not the same old cyber coverage
There are significant opportunities for insurance companies to meet the current demand for their existing cyber products. It is also possible to reinvent the offer of cyber insurance to meet customers' needs during development.
Consider a cyber solution from start to finish that consists of at least three different components:
- Continue the simple nuclear insurance policy to compensate the customer in the event of an attack.
- Improve preventive or restrictive offers to improve security in the customer's cyber environment.
- Create new restoration offers that help restart the customer's business, which can include online restoration work in e-commerce and work environments.
This is an increase in the scope and scope of cyber insurance offers. This gives insurance companies an opportunity to defend market shares and expand into new customer segments. It is also an opportunity for the companies to collaborate with start-ups and Insurtechs to offer more innovative offers on the market more quickly.
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