Insurance industry must collectively grow cyber liability market, exec says

Insurance firms and their clients need to focus on cyber liability risk, suggested executives at the recent Canadian Commercial Insurance Summit (CCIS).

“This is a market that we collectively have to grow,” said Andrew Hollenberg, president of ACE Canada. “We need to get out there and sell it.”

He suggested clients are “going to get in trouble” if they do not buy cyber liability insurance. Hollenberg made his comments Tuesday to a room full of brokers and other insurance industry executives during a panel discussion at the Canadian Commercial Insurance Summit (CCIS).

One of his co-panelists was Lynn Oldfield, president and CEO of American International Group Inc.’s Canadian subsidiary, which has been writing cyber liability coverage since 1999.

“We have got to pay attention” to cyber risk, Oldfield said. “This is about prevention. This is about putting some loss control around it. This is also about putting the entire IT team in to walk them through what some of the latest and greatest technology innovations are.”

Oldfield added that AIG did a survey of commercial accounts and asked executives about their risk concerns.

“Their number one risk is cyber liability and that’s because they don’t have their arms around it,” she said.

Oldfield also suggested cloud computing could present a cyber liability risk. “Massive amounts of data get to sit on someone else’s server and you access it when you need it and when you want it, but what’s their security like?”