By H. Gerald Grinter
I don't know about you, but I can't believe labor day has come and gone. It's like Captain Kirk just hit me with a quick blast of his phaser.
It's September and the stores already have "Halloween" items lurking about in all of the isles. Before you know it, we'll blaze past Thanksgiving and right through the "Holiday Season." So what's my point? I'm not sure about you, but I will purchase quite a few of my gifts for family and friends on-line. This is important to me because I want my data protected when I visit, shop or just plain ole use your website.
Did you know, in 2011, 273 breaches were reported, involving 22 million sensitive personal records. And these attacks weren't on just the big businesses. They hit some smaller ones as well - says, Ty Saglow of "Insurance Thought Leadership."
This has prompted insurers to enter the market in a big way. Rarely do insurance professionals have the opportunity to watch and be present during the creation and growth of a new coverage; but that's just the opportunity our profession has as Cyber Risk coverage continues to mature. Although cyber-insurance has been around for a while. It has really become a viable and effective coverage since around the year 2000 (thanks Conan O'Brien). Despite the increased attention to cyber incidents, most reports indicate only a minority of companies currently purchase cyber-insurance.
I'm not sure why more businesses don't buy the coverage. Seemingly, not a week goes by without a reference to cyber risk hitting the mainstream press. I think it's a lack of education. From agents as well as the underwriters who write the coverage. For example, previous surveys indicated that over 33% of companies incorrectly believe that cyber is covered under their general corporate liability. Third party litigation continues to be slow to develop outside the privacy arena and first party claim losses, outside of breach funds, is non-existent.
So you can see the industry still has room to grow as we agents/consultants attempt to make sure our clients are protected just like business owners want to protect their customers. The truth of the matter is, security programs will not get better until management begins to treat cyber security as an enterprise risk that must be governed. In my opinion cyber-liability is here to stay and will always be a part of business. Maybe the answer lies in a private-public partnership between the insurance industry and the federal government. We just need to get better at it.
Let's face it, most people don't invite friends over to read their insurance policies. That's what my clients pay me to do. I want what's best for them. After all, creating and fostering relationships and giving back is the cornerstone of great business.
For inquiries please send your emails to gerald@geraldgrinter.com or call me directly at 206.650.4342
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