Since its official launch in 2018, cyber re/insurance underwriting firm, Envelop Risk, has matured and grown alongside an increasingly sophisticated cyber re/insurance market. As such, it is now able to better understand the needs of its clients, according to Co-Founder and Chief Executive Officer (CEO), Jonathan Spry.
As the global insurance and reinsurance cyber market continues to evolve, we spoke with Envelop Risk’s Spry about the development of the company and its role in the expanding cyber risk transfer space.
“We have certainly matured as a business and scaled up. And as insurance and reinsurance has sophisticated, we’ve got more sophisticated with it,” said Spry. “Much of that, I think, is around the quality of data. We’ve been trading on a no-data, no-deal basis from day one, and that’s really paying dividends.”
Following its launch, and the completion of Series A and Series B funding rounds, Envelop Risk now has five years of data and track record, which provides it with greater insight into both the risk and its modelling, which utilises machine learning.
“It really means we can have much more detailed discussions with clients, be more proactive, and more bespoke with the reinsurance we’re offering.
“And actually, it means that we have the ability now to engage in portfolio optimization discussions, which was not possible in the past. From day one, we understood the risk, but what we now do is understand the client’s need in a lot more detail,” said Spry.
Although estimates of potential market size vary, it’s clear that the cyber re/insurance segment is expanding rapidly, and Spry explained that one of the roles of Envelop Risk is to act as a conduit and hub.
“We manage expectations, and when necessary, engage in a lot of education and knowledge transfer to make sure that all the transacting parties have visibility and transparency over the risks. Our data and our modelling are key to that,” he said.
As well as some notable hires over the past five years, the company has also launched some new initiatives, the most recent of which is its Cyber Partnership Platforms.
Spry told Reinsurance News that this new initiative has been very well received by the market.
“The Platforms are an evolution of, effectively, a white labelling approach. They enable us to be true global partners to insurance companies, rather than just a suppressant, and to provide a risk-based approach for diversification into, or growth of, their cyber business.
“So, this is very much a play on international growth. We have a different approach in the US. But what we’re trying to do is break new ground with the growth of cyber insurance in Asia, elsewhere in Europe, Africa, and the Middle East,” said Spry.
Overall, Spry views the cyber market as “healthy,” aided by the increased sophistication of its reinsurance partners and the buyers themselves.
“Clearly, we need to continue looking at coverage areas, driving product innovation and product-market fit, and making sure that there is sufficient capital available, from various sources,” concluded Spry.