White Paper

A Holistic Approach to Cyber Insurance: Why Having a Cyber Risk Engineer in Your Pocket Goes a Long Way in Security

A strong cyber insurance carrier will help clients identify what risk management tools can make them a more attractive risk.

White Paper Summary

Businesses today are becoming all too familiar with the never-ending cyber insurance application. Risk management executives and their insurance brokers might find they’re filling out question after question on cybersecurity controls before carriers will even consider offering coverage.

Increasingly frequent cyberattacks in recent years caused many carriers to become more discerning when selecting the risks they underwrite. Many have raised rates and tightened terms and conditions in order to remain profitable. Global cyber insurance prices increased 28% year-over-year in the fourth quarter of 2022, per reporting from the Wall Street Journal. These rate hikes come after a 48% increase in Q3, compared to the previous year, and a 79% increase in Q2.

“We saw a rapid hardening of the market conditions with a contraction of terms and conditions, contraction of limits and massive increases in prices,” said Jamie Schibuk, EVP of PL & Cyber at Arch Insurance Group Inc.

In addition to helping carriers decide what risks they want to underwrite, these questionnaires offer carriers data on potential clients’ cyber exposures. When paired with cyber risk engineering, insurance applications can provide insurers with a starting point for helping clients improve their cyber risk profiles — potentially preventing attacks and leading to a more profitable line in the long-term.

“Clients today are answering, in many cases, in excess of a hundred different security control questions as part of the application for insurance,” Schibuk said.

“Through that process, we’re getting a really great view into their security controls, understanding where they’re strong and where they may have deficiencies, to the extent that we can identify where there’s opportunities for improvement.”

To learn more about Arch Insurance, visit their website at https://insurance.archgroup.com/

Arch Insurance North America provides a wide range of property, casualty and specialty insurance for corporations, professional firms and financial institutions.

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