“Excuse me, do you have a moment to talk about privacy liability for non-technology companies?”
The evolution of cyber insurance is illustrated by how its name has changed over the past few decades and by the streamlined, accessible products now hitting the SME market. Discussing the launch of Aviva’s new cyber insurance solution for SMEs, Neil Arklie (pictured), head of cyber insurance, Aviva, noted that it has been great to launch the solution after about two years in development.
Aviva created its first standalone cyber product in 2017 but its recognition that cyber risk is too big an exposure to be considered a niche or specialist cover any longer has driven the insurance giant’s team to build on its distribution network and prior policies to create this new offering. This is about identifying cyber insurance as an essential product, he said, by utilising Aviva’s long-standing brand equity and distribution network and upskilling underwriters throughout its regional network, as well as financial lines underwriters.
“The cyber insurance gap faced by SMEs exists because technologies has evolved, it’s as simple as that,” he said. “And one of the good things about cyber insurance is that the insurance industry has evolved to meet new and developing needs […] and continues to evolve. This is probably the fastest evolving product I’ve ever been involved in. Aviva has recognised that this is something we need to give a solution to our clients for, especially our SME clients, our core market. That’s where the development came from, and we’ll continue to develop as well – it’s not a product for standing still.”
As perfectly surmised by the former head of Willis, Joseph J. Plumeri, Arklie said, insurance is the DNA of capitalism and it empowers people to take risks. People now have to take risks in an intangible and non-physical space and insurance must respond to that by giving them the confidence to take calculated risks, knowing they are supported. Supports such as Aviva’s breach response service, which offers swift access to a 24/7, 365, network of incident response specialists emphasise the value of cyber insurance in a digital-first business environment.
Aviva’s recent ‘Risk Insights’ report revealed that cyber exposure is the fifth biggest risk faced by SMEs, and the full gamut of this concern runs from loss of reputation to business interruption. Interestingly, he said, the report revealed that 20% of SMEs stated they were not aware of facing any cyber exposure, which is an area of emphasis for the insurer which is working with its broker partners to support them in educating their clients about the exposures they face.
“Cyber incidents are usually short and sharp and really quite extreme,” Arklie said. “The kind of incidents we’ve seen is where clients have their systems locked up in a ransomware attack or something similar and they need to get up and running pretty quickly. The first 72 hours is key, as is getting experts in, and that’s where the insurance can really add value.”
SME clients are rightfully concerned about the current macroeconomic environment, he noted, which often means putting something of a hold on buying non-mandatory coverages. However, Arklie believes that as the economic situation improves and brokers become more comfortable with the product, cyber insurance will become a more standard purchase. A large part of making both brokers and customers more comfortable with cyber is about creating accessible product wordings, which has been instrumental to the development of this new product.
As the name has evolved, so too have active cyber markets and the language around cyber wordings, he said, and so Aviva has taken a packaged approach by enforcing a commonality across its wordings and its terms and conditions. Aviva’s new cyber product offers brokers familiar wordings while presenting an enhanced and updated product that has evolved alongside the cyber risk environment.
“As Colm [Holmes, CEO of general insurance, Aviva] has said about Aviva being number one and continuing and growing - if we can make it as easy as possible for our brokers to deal with Aviva, it’s a win-win for both. This has been a long time in the making, but the key thing we’ve seen is that brokers want a digital journey.
“That’s why we launched on Fast Trade, powered by Acturis, and why there’s a very limited number of questions that the broker has to ask… It’s a simple journey, they get an answer and a firm, bindable quote very quickly and then they can talk to their clients about the benefits of the product. And I think that’s the main benefit to brokers - that speed of response and being able to engage with their clients so quickly.”
