The analogy brokers should be using when selling cyber

The analogy brokers should be using when selling cyber | Insurance Business

The analogy brokers should be using when selling cyber

With an estimated 90% of all Australian SMEs now online, the need for cyber insurance has never been higher – however, many brokers continue to face pushback when suggesting a dedicated cyber policy to their clients.

Now, the founders of specialist cyber underwriter Emergence say they’ve come up with a simple way to help brokers communicate the need for coverage to their clients.

“One of the best things we’ve done at Emergence is trademark the term ‘digital fire’,” says Troy Filipcevic, who’s also the managing director of the award-winning firm.

“The reason we did that is because we’re trying to draw the analogy to property insurance which many people will have been buying for 20 years.”

Explaining the theory behind the analogy, Filipcevic says if a client walked to their office tomorrow, and the building had burned down, they’d have property insurance which would cover rebuild costs and return the office to how it was before the fire.

However, if the company suffers a digital fire – that is the client walks into their office and their IT system has been hacked and they can’t operate – then it would take a comprehensive cyber insurance policy to get their systems back up to how they were prior to the attack.

“If your business has suffered a loss from a revenue perspective, the policy will also replace the revenue - but what we’re trying to say is, it basically works in exactly the same way as property,” he tells Insurance Business. “We’re trying to draw an analogy to something that’s very common and easy to understand for a lot more people.”

Filipcevic acknowledges that, even with the analogy, brokers still get pushback from clients who insist they’re safe because they have the latest anti-virus or an IT guru on board.

“You can still bring that back to the property analogy because buildings have fire extinguishers, fire alarms and they have fire retardant doors and floors, but they still have property insurance,” he says.

“All of those things are there to help mitigate the risk but they don’t stop it from happening and it’s the same with cyber – you might have back-ups and anti-virus and an IT genius, but things can still go wrong,” he continues.

“That why trademarking the ‘digital fire’ phrase is one of the best things we’ve done – when brokers start to use that analogy, it makes their sell job and that education piece with clients a lot easier.”