Global reinsurance giant Munich Re continues to grow its cyber business in-line with the market, and also remains more focused on providing solutions for small and medium sized enterprises (SMEs), according to the Chief Executive Officer (CEO) of its Reinsurance segment, Torsten Jeworrek.
Speaking during an analyst and investor call following an announced updated profit guidance for 2019, Munich Re executives discussed the reinsurer’s performance in 2018 and its outlook for the year ahead.
During the Q&A session, executives were questioned on the cyber market as a whole and more specifically on Munich Re’s position in the market, and its expectations of how the space might develop.
Jeworrek explained that today, Munich Re’s share in the cyber insurance market is close to 10%, adding that in past years it has grown in-line with the original market, which the reinsurer thinks is above $5 billion by the end of 2018.
“So far, we didn’t lose any market share, and we have many activities underway to participate in the small but steadily growing markets in Europe and in Asia,” said Jeworrek.
Regarding its cyber business, the CEO explained that it does have a little bit of everything, but underlined that its clear focus is in the SME business, for a number of reasons. This includes the fact that Munich Re’s strategy isn’t just to sell cyber insurance in case of a loss, but the idea is also to help build solutions that really assist SMEs, in terms of prevention and risk assessment, ultimately improving underlying infrastructure.
The better the terms of this, explained Jeworrek, the better product Munich Re can offer.
Providing solutions to a large number of SMEs also allows diversification, something that is very valuable and important in cyber risk. He continued to explain that providing solutions to a large number of SMEs means the firm can price the risk based on a large number of independent risks, adding that Munich Re has “a proven track record in that business.”
“In general, we have a very decent performance here, we have very strict risk management and accumulation rules. We identify scenarios and unmanageable ones will not be covered by us. We cover those parts where we have accumulation and risk management in place,” said Jeworrek.
