Jargon and specialist talk: Struggles abound for brokers selling cyber

Talking about cyber insurance as a specialist product and wrapping it in technical jargon creates barriers for brokers looking to reach potential customers, says Andy Holmes, group capacity director at CFC.

“For too long, the cyber market has seen itself as a niche corner of the industry — and spoken like one,” writes Holmes in a LinkedIn blog, Cyber is a product for everyone. So let’s start acting like it. “We’ve wrapped the product in a language that needs decoding, using acronyms and technical jargon that make the product inaccessible to the very people we want to reach.

“If generalist brokers can’t explain what cyber insurance actually does in a way SME businesses can understand, that’s on us.”

For example, the industry may use terms like ‘MFA’ for multi-factor authentication, ‘threat actors’ for criminals or ‘cyberattack vectors’ for the methods criminals use to attack, Holmes tells Canadian Underwriter in an interview.

Or they may use terms like ‘first party’ and ‘third party,’ “which is just explained that if you have a cyberattack and you lose some money because [of] business interruption, the insurance will pay. And also, if your customers are interrupted and they sue you, it’ll pay,” Holmes says.

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“Cyber brokers spend a lot of time with cyber insurers. And the problem is they can all talk cyber language; they just don’t adapt their lexicon to get cyber to the next level, which is not selling it as a specialist product — [it’s] selling it as a generalist product to generalist brokers and generalist customers,” Holmes says. “You have to adapt the language that’s used and even the description of the product to go from specialist market to mass market, which is what we really want the product to do.”

Practising trying to explain what cyber is to your mom is a great way of stripping back the jargon, Holmes tells CU. “And I had exactly that conversation. And you realize how much insurance-isms we cover the product in.”

When brokers aren’t cyber specialists

It’s fair to say most brokers aren’t cyber specialists, “so when cyber comes up, with its specialist reputation preceding itself, eyes can glaze over,” Holmes writes in the blog. “That’s not because they’re not interested in cyber, but because the value proposition is not clearly communicated.”

This can make brokers hesitant to sell cyber. “Most brokers that I know that aren’t cyber specialists won’t sell cyber when their average customer is coming up for their property and casualty renewal,” Holmes says. “And to me, that’s a massive failing of us as a market, because name me another product that every single business in the world should buy.”

Holmes calls cyber insurance the industry’s “best-kept secret” and “probably the best insurance product ever created.” It offers a host of both preventative and incident response services. And the best cyber insurers are now scanning clients throughout the entire policy period and keeping an eye out for new threats or vulnerabilities, he says.

So, how should brokers position the cyber product?

As modern-day crime insurance, Holmes says. “We sold product for years for physical crime. This is now digital crime.”

He argues cyber insurance can be both specialist and generalist — part of a standard commercial package, but also standalone for companies with heightened exposure. “At the moment, the insurance market has only had success with it as a specialist product.”

Holmes points to statistics showing only a 5% cyber insurance penetration rate for Canadian businesses.

“We’ve got to get better penetration rates,” he says. “This product has mass market appeal, and the whole insurance industry is missing the trick…But it shows how much potential there still is for this product, if we get the sales pitch right.”

Jason Contant

Jason has been an award-winning journalist with Canadian Underwriter for more than a decade, including the past three years as associate editor and, before that, as digital editor for seven years.