Cyber risk is far from static. It’s ever-evolving, erratic and completely at odds with the traditional insurance model.
The risk changes so quickly that accustomed year-long policy periods suddenly become a bit of a gamble. There’s nothing a carrier or broker can know upon policy issuance that will give enough confidence that cyber exposures will not evolve within the course of the policy. A vulnerability crops up two months into the policy period, and many companies simply have to carry that bad risk on their portfolio for another 10 months.
California-based cyber insurer At-Bay is working hard to counteract that problem. Its cyber security research and modeling approach predicts future risks based on emerging threats. The company is always scanning for new vulnerabilities to help its customers close security holes quickly and avoid loss.
“If we can monitor the security or our clients and proactively scan them for vulnerabilities, we can help them by offering our own in-house experts who can react quickly to a cyber event and avoid losses wherever possible,” said At-Bay founder and CEO, Rotem Iram. “Cyber risk changes all the time. It’s too complex and technical for many clients and organizations (especially middle-market) to understand, and so having the support of our expert cyber security team is a huge value add for them.”
The broker channel is a key gateway of communication and education about cyber risk. At-Bay partners with brokers and gives them security and financial exposure insights that they can pass on to their client to help them design a proactive, comprehensive risk management program.
At-Bay recently introduced two new features to its portfolio of cyber risk assessment products that will act as key tools for intermediaries: Security Score and a Data Breach Cost Calculator. The Security Score gives customers tools to benchmark their security and understand their top vulnerabilities, while the Data Breach Cost Calculator allows risk managers to model loss scenarios to understand potential financial exposure.
“Our guiding principal is that if we generate insight internally about a client, we want the broker to have access to that insight. Cyber’s not a figured-out space, so there’s lots of room to provide brokers with tools so they can best serve their clients,” Iram told Insurance Business. “Our new Security Score calculator generates security reports about companies that brokers can share with clients in order to have more focused cyber risk management conversations.
“The second new tool is our Data Breach Cost Calculator. There are a few examples of this in the market but we didn’t really like what we saw, either from ease of use or how insightful and accurate they were. Therefore, we decided to use our own underwriting model and pricing model to capture the financial exposure a company might face due to data breach. Again, we make this insight available to our brokers, who can then share those insights with their clients. We want to help foster a better understanding of cyber risk. For us, that would be a great use of our resources.”
Business is going “incredibly well” for At-Bay after only four months in the market. Yesterday, the company announced a $13 million Series A funding round co-led by Keith Rabois of Khosla Ventures, Yoni Cheifetz of Lightspeed and Shlomo Kramer. This brings the company’s total funding to $19 million. Shlomo Kramer, former founder of Check Point and Imperva, as well as CEO of Cato Networks, will join At-Bay’s board.
“We’re really excited and honored to have the support of Keith Rabois, Yoni Cheifetz and Shlomo Kramer. We’re proud they’ve selected to back us up and we will do everything we can to deliver the high standards they expect,” Iram commented.