European risk managers faced up to insurance bosses as they discussed the ‘industrialisation of crime’
A trio of risk managers faced up to insurance industry bosses during a panel discussion titled, Insurance in Transition, on Day One of the Ferma Forum 2022 in Copenhagen.
Addressing the challenging cyber market, Sussi Sommer Bisgaard, senior risk manager at Coloplast, said that an increasingly complex cyber risk landscape meant the company was seeking to transfer more of its risk at a time when coverage was difficult to find.
She said it was incumbent upon insurers to better explain what is driving the risk, exposure and availability of capacity, as well as the premium.
The trio of insurance execs acknowledged that the characteristics of cyber risk - with the potential for systemic accumulations, an exposure that was frequently changing and need for more data had held the market back.
Tomorrow is different to yesterday
Cyber risk is a ’permanently changing environment’, thought Edgar Puls, chairman of HDI Global SE. “We are all having to deal with accumulation risk,” he said.
The losses of the past two years have caused the industry to pause, added Xavier Veyry, chief executive of AXA XL. He said the private sector had been hit by cyber losses of around $5 trillion in 2021, which could easily become $10 trillion by 2026.
The solution, he said, lay in the sharing of data, as well as transparency and partnerships.
“The world is changing fast and we all need to adjust,” he said. “What we’re seeing with cyber is the industrialisation of crime and we need to tackle it together. Insureds, governments and the insurance industry need to work together collectively.”
Once the industry can better understand and model systemic risk and take necessary steps to protect its balance sheet, it would be in a better position to help grow the market.
It’s about being there for the long term, explained Henning Haagen, board member and chief regions and markets officer at Allianz Global Corporate and Specialty SE.
“We need to make sure we are here for the long run and we need different tools so we can understand the risks.”
Blog: FERMA 2022 Daily News Summary sponsored by AXA XL
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Ferma: Panel tackles $10 trillion cyber accumulation
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