Cyence

The National Association of Insurance Commissioners (NAIC) has weighed in on the difficulty of writing cyber coverage. Cyber risk remains difficult for insurance underwriters to quantify due in large part to a lack of actuarial data. Insurers compensate by relying on qualitative assessments of an applicant’s risk management procedures and risk culture. As a result, policies for cyber risk are more customized than other risk insurers take on, and, therefore, more costly, acc...ording to the NAIC. Hartford Steam Boiler, an insurer that began covering risks associated with steam boilers 150 years ago, is now offering small insurers the ability to sell cyber policies to small and midsize businesses (SMBs). Using an economic model developed by Cyence, Hartford Steam Boiler quantifies cyber risk in dollars and probabilities to aid insurers in pricing cyber policies efficiently and cost-effectively. The model looks at certain data elements like the frequency of attacks occurring, technical patching, policies, procedures and even employee sentiment. The model aids in determining whether a company is an attractive target and susceptible to attack. For more information, see: http://www.insurancejournal.com//nat/2017/02/24/442728.htm

Traditional risk modeling techniques are not effective or adequate in attempting to plan for and hedge against cyber risk. Before committing capital, an effective understanding of cyber risk requires access to insights that gauge the many possible threats and their impact, using a comprehensive analysis based on dynamic analytics that tap into a variety of technical and non-technical data sources to continually monitor the cyber risk of a portfolio of companies. An agile cyber risk model that integrates in-depth data analysis and sophisticated economic modeling provides a robust platform to make confident decisions on probability, impact, severity and accumulation. https://www.cyence.net/modeling.html

Cyber Risk is both a major opportunity and a challenge for the #insurance industry, said Matthew Mosher, chief operating officer at A.M. Best Rating Services. On one hand, Cyber is a high growth new premium opportunity but simultaneously Cyber is a peril across many lines of insurance. A.M. Best is happy to be working with Cyence and leveraging their #economics and risk modeling perspective on #cybersecurity to move the cyber risk discussion onto the critical topics of probabilities and dollars, severity curves and probable maximum loss. For more information, visit https://www.cyence.net/

Cyber risk is a major concern for our clients. While there has been a focus on risk prevention and mitigation through #technology investment, a holistic cyber risk strategy should balance risk mitigation with risk transfer, said John Drzik, President, Global Risk and Specialties, Marsh, a leading global #insurance broker. We are pleased to collaborate with Cyence and apply their innovative #analytics to develop new insurance solutions for a wide segment of clients from small businesses to multinationals. For more information, visit https://www.cyence.net/

"Companies can take the same rigor they use with natural #disaster and pandemic risk and apply it to cyber threats, according to Arvind Parthasarathi, CEO of Cyence, a #cybersecurity risk analytics platform. Organizations can test a variety of mitigation plans, which may call for multiple remote datacenters, different backup and recovery processes, and redundant staff. All these plans can be modeled and assessed in dollars and cents." "In that exercise, companies can ask what... the #probability is of a breach or security event and ponder its severity. They can also try to discern direct and indirect costs, from replacement laptops to lawsuits, Parthasarathi said. Companies can decide how much they want to take on themselves, or how much #insurance to buy, or look at alternative #capital to hedge their cyber risk, he explained." From the article "Five Things Every Business Executive Should Know About Cybersecurity" in Dark Reading: http://www.darkreading.com/drdigital/20161206td

Traditional #risk modeling techniques are not effective or adequate in attempting to plan for and hedge against #cyber risk. Before committing #capital, an effective understanding of cyber risk requires access to insights that gauge the many possible threats and their impact. One must use a comprehensive analysis based on dynamic #analytics that tap into a variety of #technical and non-technical #data sources to continually monitor the cyber risk of a portfolio of companies. An #agile cyber risk model that integrates in-depth data #analysis and sophisticated #economic modeling provides a robust platform to make confident decisions based on the frequency, severity and accumulation of exposures. https://www.cyence.net/modeling.html

If a cybercriminal is able to break into a company’s network, it could result in fallout for hundreds or even thousands of associated companies or individuals that share their data with that #organization, particularly if there are shared paths of accumulation across these companies. This can cause accumulation of exposures or cascading cyber events resulting in large losses from a single event. The #insurance industry is looking to clearly define where their exposure begins and ends to make responsible capital decisions and protect themselves, their policy holders and the market at large. https://www.cyence.net/modeling.html

The reasons for a company to become a casualty of a #cyber event are extremely varied and dynamic, and the responses and resulting losses cannot be tied to a simple formulaic approach. This requires complex #risk models that include a large number of motivational factors and the interactions between these factors since they are all operating simultaneously. https://www.cyence.net/modeling.html