The Expert Podcast

Here's another insider data point for the cyber insurance industry Beasley is one of the larger Lloyd's of London insurance cartel members . And they gave a report on what's going on with commercial lines and also cyber . First of all their profits fell on it's investments meaning that the money that insurance companies take in from premiums , they put into investment vehicles to pay out claims later . And they put everything from . Equities to bonds . to real estate They have multiple different . investment . avenues that they use . And obviously with the stock market down there investments are down But the hidden story within in this is booming cyber market meaning that . In their cyber industry . The premiums are higher . A major cyber insurer now expects its combined ratio 80 90% . That's much better than forecast for cyber . The profits are down because of investments hefty losses on investments but cyber premiums almost doubled . To 473 million from two 67 million in the first half of 21 . So 2 67 . this the first half of 21 and it doubled to 473 million cyber premiums have increased so much because exposures have increased due to the rise of cyber criminality in the last four or five years . As an insurance agent . This is something . be aware of . If you're presenting risks to your insurance to your clients to your book of business . You need to be aware of this new risk creeping into the marketplace for your commercial clients . If your commercial clients do not have coverage , it's almost like you're not providing them coverage for the risks that are important . What if cyber risk is actually a higher probability than fire ? Or E&O or slip and fall or even commercial auto . losses . If you're not presenting that as part of a loss prevention program , then . You might be leaving . Some liability . And risk exposure for your customer that you and And they may not be aware of . Demand has also risen because more companies see the need for protection In the past . If you were an insurance agent or broker you had to really explain and tell your clients about the cyber risk . awareness. Many . Commercial lines Customers didn't know anything about cyber risk Yeah They may have heard of it They may have heard about hacking ransomware but they weren't calling you saying Hey I want cyber coverage now . Many clients are bringing that to the attention of the , the agent or the broker . The other difference in the marketplaces . Many insurers like in this case , Beasley . They can accept assess risk better because of technology . They're now starting to be able to figure out risk not from prior claims Cause you know prior claims have nothing to do with what the claims are going to be next year . It's not like other lines where you can predict future claims by . loss runs . You have to go by assessing the risk for your new insured . Now there are technology platforms and underwriting platforms that can help the insurer . Determine the expected . Lost potential for a particular client . For a policy . Price it occur . underwriting accordingly . So if you're a business that does not have cyber , you might want to look into it because now the risk can be assessed better If you're a broker or agent . look into what markets are available for a while The markets are very hard . and you couldn't really access them but now more insurers a lot of , non-legacy non traditional insurers are bringing in . methods to create . Markets and to create products that didn't exist even six or eight months ago .