According to KPMG, cyber insurance would seem like a strong candidate for the next wave of risk management innovation that Bermuda could take a significant role in.
This follows after the UK Government released a report on joint initiatives between the Government and the insurance sector to tackle cyber risk.
The report, ‘UK cyber security: the role of insurance in managing and mitigating the risk’, published by the UK Government and Marsh, has been produced in collaboration with the UK’s insurance market and a number of top UK companies. It aims to make the UK a world centre for cyber security insurance.
In particular, it highlights the exposure of firms to cyber attacks among their suppliers with a key agreement that participating insurers will include the government’s Cyber Essentials certification as part of their risk assessment for small and medium businesses.
Tom Kelly, Managing Director at KPMG commented, “This report address three themes – Helping firms get to grips with cyber risk; Helping the insurance industry to establish cyber insurance as part of a firm’s cyber tool-kit and; Helping London to be a global center for cyber risk management.
“With the ever growing dialogue around the decline in property catastrophe pricing, cyber insurance would seem like a strong candidate for the next wave of risk management innovation that Bermuda could take a significant role in.
“In order to be on the cutting edge of these developments a more robust dialogue needs to be had here in Bermuda between the Government, the [re]insurance industry and Bermuda Monetary Authority to ensure we have the right framework, incentives and skill sets to attract and appropriately manage this business.”
“Cyber risk is one of the most significant issues facing all sectors of the economy today. This is no longer ‘script-kiddies’ showcasing their skills to secure employment, but more typically well-organized, advanced persistent threats monetizing cyber-crime, fraud and the theft of intellectual property,” said Chris Eaton, Senior Manager and IT Advisory Lead at KPMG.
“In addition to the thought provoking discussion on cyber risk by a Steering Committee comprising some of the largest [re]insurance companies in the UK, the report also provides very useful guidance to businesses on cyber risk and mitigation referencing the UK Government Cyber Essentials scheme”.
The UK cyber security report follows below [PDF here]: