Advisen was clever enough to ask Cyber Risk Awards nominators what they least are looking forward to as a result of more interest in cyber risk.
After lofting a softball (What was the most significant news story to impact the cyber community in 2013?) and getting a majority of more-than-predictable, albeit true, answers (Target), Advisen threw a curve and quizzed: What is the least anticipated consequence of the increased interest in cybersecurity?
Seventy-four individuals responded, and there was no overwhelming theme.
Almost all of you answered thoughtfully, but for the respondent who offered simply, “Candy Crush.” I’m not familiar with the game. Therefore, I can’t overrule the possibility Candy Crush is indeed a least-anticipated consequence. Though I’m betting the response was from an investor gone sour.
Some more serious answers included: “As more and more organizations buy network security and privacy liability from the same markets that that offer professional liability insurance, aggregation will continue to be a concern. Few markets are doing anything to address the issue.”
“Aggregated loss due to cloud failure may wipe out a book of business.” Just one?
Someone else agreed, offering as an answer: “Aggregation and the market’s continued inability to wrap our hands around it. E&O insurance will also be impacted when technology is involved in a data event.”
It was interesting to observe obvious differences between insurance buyers and sellers. One expressed concern over carriers fleeing the cyber insurance marketplace, especially in the retail sector. Another said a consequence of increased cybersecurity interest would be rates declining. Presumably another buyer flatly said: “rates being adequate.”
There was this thought-provoking prediction that carriers, “after touting cyber insurance policies as panaceas for cyber risk, will rely on outside counsel to take aggressive positions and deny coverage for the most expensive parts of the claim.”
Also along the litigation line was: “Class-action and similar legal opportunism.”
Many offered a more general observation, not exactly answering the question. Multiple respondents loathed the fact take-up rates don’t seem to be improving despite organizations and risk managers taking a harder look at cyber coverage.
“While the demand has certainly exploded, the ability to educate clients at every link in the chain from the insurance buyers, retailer, and wholesalers and up to the underwriters has not kept pace with that demand,” someone said.
