‘There is a very strong will to take on cyber risks, but insurers need to build a book of business around that’ – Marsh’s EMEA cyber risk lead Stephen Wares
Gaps in the cyber insurance market could be addressed if clients are clear about their risk exposure, Marsh cyber risk practice leader (EMEA) Stephen Wares (pictured) advised.
Addressing delegates at Marsh’s Cyber Security Update last week, Wares suggested that the insurance market is not fully addressing all cyber risks but just some of the consequences arising from an attack.
He blamed the shortfall in cover on a lack of clear communication from clients to insurers, stating: “The insurance market is dealing with one specific impact because clients were clear about their demands, the trigger of events and the losses that flow from that.
“If you can tell them what the triggering event is and what losses arise from that triggering event, the chances are there will be a strong will to insure that.
“There are about 30 insurers in the London market that are writing cyber policies. There is a very strong will to take on risk, but they need to build a book of business around that.”
Wares claimed that although insurers’ appetite to cover such risks is increasing, the lack of understanding about cyber risks among insurance buyers means little time is spent identifying and quantifying cyber exposures.
He concluded that risk managers must undertake a thorough assessment of their cyber risk exposures before approaching insurers, adding: “Without that, the insurance market is not going to build its products outwards.”