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The Profession

Joseph J. Mazza

Director of risk management Joseph Mazza says heightened visibility is good for risk managers, but cyber remains a top challenge.
By: | October 15, 2015 • 4 min read

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R&I: What was your first job?

During my senior year in high school, [I worked] as a custodian every night and full time on Saturdays for $1 an hour. I had the run of the school. It turned into a summer job at $1.25 an hour after senior year!

R&I: How did you come to work in risk management?

Having started as an insurance agent in life, health, and then property and casualty in 1975 at John Hancock … I wanted to explore company exposures beyond the insurance field. … I worked for a multiline commercial insurance agency and then a national retailer insurance program for franchisees with Ace Hardware for 20-some odd years. I enrolled in the Associate in Risk Management (ARM) program in 1997 and 1998, and was hired the next year by DaimlerChrysler.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

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For risk management, the biggest change has been heightened visibility and a better understanding of what it is and how it can drastically impact the bottom line of any entity. For insurance, it’s the speed and communication between underwriters and the producer with the advent of technology. Keep in mind I started in the “write back” days of waiting and waiting for snail mail to arrive.

R&I: What emerging commercial risk most concerns you?

As everyone currently considers data breaches a primary concern, I will go with that one too, and have implemented an insurance policy for my district accordingly. … The main focus here would be protection of data for employee records, student records, financial aid records and other important data we have in our computer systems. If we had a breach, it would be devastating.

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Joseph Mazza, Director, Risk Management/ ADA Coordinator, MiraCosta Community College District

R&I: How would you rate the insurance industry’s response to cyber risk?
Excellent so far with corresponding rate increases coming now that more purchasers are coming on board. Those insured losses need to be paid by someone. I think the frequency of cyber risk is increasing, and that frequency can cause a big severity problem.

R&I: Who is your mentor and why?

Most recently, Edwin Hall, a former regional manager with DaimlerChrysler, who had a great way of understanding and managing people. For my insurance career, it was Al Klipstein, who was an agent when I was with John Hancock. His personality matched mine and I learned so much about the business from him as he was highly successful and a great source of information.

R&I: What have you accomplished that you are proudest of?

Building relationships with colleagues in and out of my entity is the main one. I have been able to implement important driver authorization programs for district drivers. Serving as the San Diego RIMS chapter president for two years in 2012 and 2013 and being awarded the Risk Professional of the Year designation for my chapter in 2008 are very special to me too. I have found that my sense of humor has really helped break the ice and build rapport and it makes my life and career more enjoyable.

R&I: What insurance carrier do you have the highest opinion of?

I like both ACE and AIG as they are both equally high-quality carriers, with AIG returning to an important spot in the marketplace since the financial crisis.

R&I: Are you optimistic about the U.S. economy or pessimistic and why?

Being a born optimist, I am hopeful that the free market system really gets back to the growth days we saw several decades ago.

R&I: What is the best restaurant you’ve ever eaten at?

Antoine’s Restaurant in New Orleans. My wife and I once had a meal there in the early ’90s that ended with the server pouring a liquor-based sauce for dessert on the white tablecloth and lighting it! No one got burned and it was just a wonderful dinner. I’m not sure they still do that, but it was special.

R&I: What is the most unusual or interesting place you have ever visited?

Cumberland Falls State Park near Corbin, Ky., has a moonbow, the only one in the Western Hemisphere. You know what a rainbow is — here there is an actual “moonbow” at night!

R&I: What is the riskiest activity you ever engaged in?

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Forcing myself to speak publicly, for someone with the fear of doing so, is very risky. It was dreadful the first few times. After that, I learned to find a few people to focus on in the front row and to make eye contact with them. If there’s a large group I will stand at the front door and introduce myself as the speaker or presenter. Now you aren’t speaking to a room of strangers; you’re not going in cold. It’s a technique that a lot of people can use.

R&I: What about this work do you find the most fulfilling or rewarding?

Since we are an educational institution, what is most fulfilling to me is serving faculty and students in a support role and making our district a great place to learn and succeed.

R&I: What do your friends and family think you do?

They know I was the “insurance guy” for years and then when risk management came along they did not understand it … . At one time, I told them I was in the witness protection program and earned a good living doing that — just kidding!

Janet Aschkenasy is a freelance financial writer based in New York. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Cyber Resilience

No, Seriously. You Need a Comprehensive Cyber Incident Response Plan Before It’s Too Late.

Awareness of cyber risk is increasing, but some companies may be neglecting to prepare adequate response plans that could save them millions. 
By: | June 1, 2018 • 7 min read

To minimize the financial and reputational damage from a cyber attack, it is absolutely critical that businesses have a cyber incident response plan.

“Sadly, not all yet do,” said David Legassick, head of life sciences, tech and cyber, CNA Hardy.

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In the event of a breach, a company must be able to quickly identify and contain the problem, assess the level of impact, communicate internally and externally, recover where possible any lost data or functionality needed to resume business operations and act quickly to manage potential reputational risk.

This can only be achieved with help from the right external experts and the design and practice of a well-honed internal response.

The first step a company must take, said Legassick, is to understand its cyber exposures through asset identification, classification, risk assessment and protection measures, both technological and human.

According to Raf Sanchez, international breach response manager, Beazley, cyber-response plans should be flexible and applicable to a wide range of incidents, “not just a list of consecutive steps.”

They also should bring together key stakeholders and specify end goals.

Jason J. Hogg, CEO, Aon Cyber Solutions

With bad actors becoming increasingly sophisticated and often acting in groups, attack vectors can hit companies from multiple angles simultaneously, meaning a holistic approach is essential, agreed Jason J. Hogg, CEO, Aon Cyber Solutions.

“Collaboration is key — you have to take silos down and work in a cross-functional manner.”

This means assembling a response team including individuals from IT, legal, operations, risk management, HR, finance and the board — each of whom must be well drilled in their responsibilities in the event of a breach.

“You can’t pick your players on the day of the game,” said Hogg. “Response times are critical, so speed and timing are of the essence. You should also have a very clear communication plan to keep the CEO and board of directors informed of recommended courses of action and timing expectations.”

People on the incident response team must have sufficient technical skills and access to critical third parties to be able to make decisions and move to contain incidents fast. Knowledge of the company’s data and network topology is also key, said Legassick.

“Perhaps most important of all,” he added, “is to capture in detail how, when, where and why an incident occurred so there is a feedback loop that ensures each threat makes the cyber defense stronger.”

Cyber insurance can play a key role by providing a range of experts such as forensic analysts to help manage a cyber breach quickly and effectively (as well as PR and legal help). However, the learning process should begin before a breach occurs.

Practice Makes Perfect

“Any incident response plan is only as strong as the practice that goes into it,” explained Mike Peters, vice president, IT, RIMS — who also conducts stress testing through his firm Sentinel Cyber Defense Advisors.

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Unless companies have an ethical hacker or certified information security officer on board who can conduct sophisticated simulated attacks, Peters recommended they hire third-party experts to test their networks for weaknesses, remediate these issues and retest again for vulnerabilities that haven’t been patched or have newly appeared.

“You need to plan for every type of threat that’s out there,” he added.

Hogg agreed that bringing third parties in to conduct tests brings “fresh thinking, best practice and cross-pollination of learnings from testing plans across a multitude of industries and enterprises.”

“Collaboration is key — you have to take silos down and work in a cross-functional manner.” — Jason J. Hogg, CEO, Aon Cyber Solutions

Legassick added that companies should test their plans at least annually, updating procedures whenever there is a significant change in business activity, technology or location.

“As companies expand, cyber security is not always front of mind, but new operations and territories all expose a company to new risks.”

For smaller companies that might not have the resources or the expertise to develop an internal cyber response plan from whole cloth, some carriers offer their own cyber risk resources online.

Evan Fenaroli, an underwriting product manager with the Philadelphia Insurance Companies (PHLY), said his company hosts an eRiskHub, which gives PHLY clients a place to start looking for cyber event response answers.

That includes access to a pool of attorneys who can guide company executives in creating a plan.

“It’s something at the highest level that needs to be a priority,” Fenaroli said. For those just getting started, Fenaroli provided a checklist for consideration:

  • Purchase cyber insurance, read the policy and understand its notice requirements.
  • Work with an attorney to develop a cyber event response plan that you can customize to your business.
  • Identify stakeholders within the company who will own the plan and its execution.
  • Find outside forensics experts that the company can call in an emergency.
  • Identify a public relations expert who can be called in the case of an event that could be leaked to the press or otherwise become newsworthy.

“When all of these things fall into place, the outcome is far better in that there isn’t a panic,” said Fenaroli, who, like others, recommends the plan be tested at least annually.

Cyber’s Physical Threat

With the digital and physical worlds converging due to the rise of the Internet of Things, Hogg reminded companies: “You can’t just test in the virtual world — testing physical end-point security is critical too.”

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How that testing is communicated to underwriters should also be a key focus, said Rich DePiero, head of cyber, North America, Swiss Re Corporate Solutions.

Don’t just report on what went well; it’s far more believable for an underwriter to hear what didn’t go well, he said.

“If I hear a client say it is perfect and then I look at some of the results of the responses to breaches last year, there is a disconnect. Help us understand what you learned and what you worked out. You want things to fail during these incident response tests, because that is how we learn,” he explained.

“Bringing in these outside firms, detailing what they learned and defining roles and responsibilities in the event of an incident is really the best practice, and we are seeing more and more companies do that.”

Support from the Board

Good cyber protection is built around a combination of process, technology, learning and people. While not every cyber incident needs to be reported to the boardroom, senior management has a key role in creating a culture of planning and risk awareness.

David Legassick, head of life sciences, tech and cyber, CNA Hardy

“Cyber is a boardroom risk. If it is not taken seriously at boardroom level, you are more than likely to suffer a network breach,” Legassick said.

However, getting board buy-in or buy-in from the C-suite is not always easy.

“C-suite executives often put off testing crisis plans as they get in the way of the day job. The irony here is obvious given how disruptive an incident can be,” said Sanchez.

“The C-suite must demonstrate its support for incident response planning and that it expects staff at all levels of the organization to play their part in recovering from serious incidents.”

“What these people need from the board is support,” said Jill Salmon, New York-based vice president, head of cyber/tech/MPL, Berkshire Hathaway Specialty Insurance.

“I don’t know that the information security folks are looking for direction from the board as much as they are looking for support from a resources standpoint and a visibility standpoint.

“They’ve got to be aware of what they need and they need to have the money to be able to build it up to that level,” she said.

Without that support, according to Legassick, failure to empower and encourage the IT team to manage cyber threats holistically through integration with the rest of the organization, particularly risk managers, becomes a common mistake.

He also warned that “blame culture” can prevent staff from escalating problems to management in a timely manner.

Collaboration and Communication

Given that cyber incident response truly is a team effort, it is therefore essential that a culture of collaboration, preparation and practice is embedded from the top down.

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One of the biggest tripping points for companies — and an area that has done the most damage from a reputational perspective — is in how quickly and effectively the company communicates to the public in the aftermath of a cyber event.

Salmon said of all the cyber incident response plans she has seen, the companies that have impressed her most are those that have written mock press releases and rehearsed how they are going to respond to the media in the aftermath of an event.

“We have seen so many companies trip up in that regard,” she said. “There have been examples of companies taking too long and then not explaining why it took them so long. It’s like any other crisis — the way that you are communicating it to the public is really important.” &

Antony Ireland is a London-based financial journalist. He can be reached at [email protected] Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]