There are more than 100 insurance companies offering cyber coverage, but only a few global insurers offer meaningful capacity for large international corporations, according to Paul Woehrmann, head of captive services at Zurich Insurance.
In a blog post on Zurich’s website, Woehrmann said that this leaves room for alternative approaches where traditional insurance has its limitations.
Traditional insurance faces difficulty when dealing with cyber risks as it is a difficult area for these companies to define.
Cyber risks are constantly unfolding and full of complexities. They involve intangible data, which presents a challenge for many of these companies. Only a scattering of owners/managers of small organisations knows precisely what they need.
When organisations increase in size and expand into different territories the complexity increases considerably.
All companies deal with cyber exposures in different ways, whilst some deal with major cyber disruptions others deal with the worry of interruptions.
Woehrmann wrote: “Captives can provide a number of major bene?ts; many of the issues in cyber insurance and global programs can be managed by pooling the risks in a captive at a reinsurance level. There are three major bene?ts of using a captive in this way.”
He added that Zurich works with companies to achieve control over their risks. Those solutions are created to achieve cost ef?ciencies, oversight and contract certainty.
Cyber-attacks are on the rise, according to The World Economic Forum’s Global Risks Report 2019. Attacks often lead to the theft of money, a loss of data, financial loss, and the disruption of operations.
