Webinar to put cyber risk issues in focus
Cyberattacks, data thefts and online business disruptions will be brought into focus today as Bermuda promotes itself as the best place to set up captive insurance companies providing cyber risk coverage.
A panel of experts will speak about aspects of cyber risk, together with the solutions that Bermuda offers.
The free webinar takes place today at noon. It is hosted by the Bermuda Business Development Agency.
While modelling for cyber risk is still at a relatively immature market stage, it is a sector that is growing in response to demand created by the exponential increase in cyber security issues impacting companies around the world.
“Cyber risk is one of the biggest, most costly and fastest-changing challenges facing companies of all sizes today, including global corporations,” said Jereme Ramsay, BDA business development manager.
There are already ten markets writing cyber risk coverage in Bermuda, and last year there was a 100 per cent growth in premiums as measured by Aon, according to Giles Harlow, assistant vice-president financial services group with Aon (Bermuda).
“It is imperative that insurance brokers, carriers and captive managers find solutions to identify, quantify, mitigate and control this rapidly evolving and dynamic threat,” said Mr Harlow, who is one of the webinar panellists. He will present an insight into the cyber risk solutions that Bermuda can offer.
The coverage overview can be broken down into three sections, with first-party coverage including everything from the security breach or disruption event, to system failure, extortion and data restoration. There also needs to be coverage for the cost of forensic investigation and paying for public relations assistance to handle adverse publicity.
Third-party considerations include security and privacy liability and defence costs, such as those that might be triggered by legal action. Furthermore, there are regulatory considerations such as fines and penalties.
Also on the panel is Chris Jansma, senior vice-president and Bermuda underwriting manager at Aspen Insurance. He will offer a perspective on the underwriting considerations for cyber risk; these include the type and volume of data and its sensitivity.
Large banking institutions, healthcare providers and big retailers carry substantial risk, Mr Jansma pointed out during a pre-webinar session. As an example, US retail chain Target is still counting the cost of its well-publicised 2013 data breach. One recent calculation put it at $252 million, with only $90 million covered by insurance.
Today’s BDA-hosted webinar looks at how to mitigate cyber risk using captive insurance, and highlights many of the positives to be gained from setting up such a captive in Bermuda.
Speaking ahead of the webinar Mr Jansma said Bermuda has a history and reputation for creating bespoke insurance and reinsurance solutions and has shown thoughtfulness and ingenuity when doing so. He also pointed out that while cyber risk management is at a very early stage of development, Bermuda has a crucial advantage when it comes to offering solutions due to the island’s extensive insurance knowledge base and its ability to act quickly.
These points were underlined further by fellow panellist Oceana Yates, vice-president of captives with R&Q Quest Management Services, who said Bermuda has the largest and most established captives, and this would increase as cyber risk coverage becomes a bigger market.
Webinar listeners will get in-depth practical advice on how to set up a captive in Bermuda.
Two professionals based in Canada, Kara Ann Selby and Emma Purdy, both with PwC Canada, will talk on this topic. It is the first time a BDA webinar has included panellists speaking remotely.
Also on the panel are Federico Candiolo, senior counsel at ASW Law in Bermuda, and Thomas Edwards, assistant vice-president of broking at Freisenbruch-Meyer Insurance Services, Bermuda. The panel moderator is George Leite, executive vice-president at Aon Risk Solutions (Bermuda).
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