A new survey by Airmic indicates that, as cyber-related risks emerge as one of the greatest perceived threats amongst risk managers, many feel that the industry must increase its own understanding and further develop offerings to clients.
The survey, which represents approximately 1100 Airmic members and nearly 500 different companies, placed cyber-risk in the top three concerns, second to reputation at 41%. Loss or theft of personal data is currently the third most pressing concern, chosen by 33%.
However, when asked to look forward three years, cyber moved to the top spot, cited by 43%.
More worryingly, many risk managers expressed a belief that their ability to respond to cyber-risk is insufficient. Only 33% were confident that the main cyber-risks have been identified and quantified, with just 22% strongly agreeing that the board has enough knowledge and understanding of such threats.
Third-party cyber-risks painted an even more worrying picture, with only 15% strongly agreeing that these are being managed in their organisations.
Additionally, the survey indicated overwhelming support for the development of services in response to data breaches, at 58%. A preference of securing data breaches in the case of interruptions to business was also shown, with 48% calling on insurers to do more in this area.
Risk transfer through insurance was favoured for a number of harder-to-mitigate risks, such as natural catastrophe (68%) and terrorist attack (63%). Cyber-events, both those causing business interruption (49%) and loss of data (45%), were also singled out.
Competitors leveraging new technology and business models to move ahead was also found to be an emerging concern, chosen by 21% with 30% expecting it to feature in three years’ time.
Julia Graham, Airmic’s Technical Director and Deputy Chief Executive Officer (CEO), commented, “Intangible risks dominate the concerns of our members, and are much less well accommodated by the insurance industry than tangible risks. This is something that underwriters and insureds need to develop further as a matter of urgency.”
