Still not convinced on the importance of selling cyber insurance? Now it seems that the industry’s “hot new product” is becoming increasingly important for a range of manufacturers too.
Cyber insurance was, for years, seen as a product needed only by consumer-facing businesses such as retailers and banks – the sort of businesses that typically keep a lot of personal information about their clients on file and are therefore most exposed should a data breach take place.
However, now a report by the
Wall Street Journal suggests that manufacturers are rushing to take out the cover – paying $36.9 million in premiums for cyber specific policies last year, according to research from Advisen Ltd, an insurance consulting firm. Indeed during 2016 manufacturers accounted for 12.6% of the total premiums tracked – a rise from 9% one year earlier.
“There’s certainly an increased exposure in the industry overall, especially with more reliance on cloud providers, greater sophistication of hackers globally and increased consumer interactions through social media,” Daniel Steiner, enterprise risk manager at Kimberly-Clark Corp. , the maker of Kleenex tissues and Huggies diapers, told the publication. The company began buying cyber insurance in 2009.
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Part of the reason behind the leap in cyber insurance’s popularity is that factories have become increasingly digitally focused with emphasis on computerized and automated software.
“Nobody should be able to look at themselves in the mirror and say ‘I’m not exposed to this’,” Robert Wice, leader for technology, media and business services of
Beazley Plc told the publication. “It should be top of mind.”
The key for brokers, it seems, is to find a policy that specifically suits their clients’ needs. Currently, selecting a policy can be difficult with a significant range in terms of the premiums quoted and the levels of cover offered. However, once you’ve found the right policy, Michael Blake, of Alliant Insurance, told the publication it should be easy to put across its value to clients.
“It’s not a difficult sell,” he said. “There is not a risk manager out there who wants to walk into a board meeting to explain why he didn’t think to get a cyber insurance quote, especially since it’s so cheap.”
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