Bermuda can lead on cyber insurance, says John Huff, head of ABIR
Bermuda continues to be a leader in nat cat coverage, and is becoming the leader in some specialty lines including cyber, according to John Huff, president of the Association of Bermuda Insurers and Reinsurers (ABIR).
Huff told Monte Carlo Today that the Island has been at the forefront of the market for some time, and that it continues to provide the thought leadership and impetus to help lead the shift to standalone cyber insurance products and cyber reinsurance.
“I’m getting very energised about cyber,” said Huff. “Bermuda will take a leadership role in this area because cyber is going to evolve.
“No-one knows yet what the magic formula is for coverage and for cyber terms and conditions, and what will be the exact value proposition for cyber coverage.
“One thing is certain: it will require flexibility and adaptation.”
According to Huff, the Bermuda market is proving itself to have the most agile, innovative and entrepreneurial market talent and cyber coverages will require that talent. Huff thinks that cyber is the beginning of insurance companies moving beyond pure indemnification of loss costs.
“What cyber is highlighting, and ABIR members have been very strong in delivering, is that cyber starts with policyholders asking the insurers and the reinsurers to tell them how to protect themselves, through the underwriting process,” he said.
According to Huff, that’s the public service that ABIR’s member companies are providing before a risk is even being bound.
“Insurers are improving cyber ‘hygiene’ by telling potential customers, who are merely applying for cyber coverage, that no, they’re not interested in them because they don’t have the software patches, or hardware enhancements, or a protocol, or a culture for cyber resilience,” he explained.
“The industry is now going from silent cyber, that may or not be in D&O and other policies, to a true standalone affirmative cyber product,” Huff concluded.
“Regulators are pushing for it and the industry is responding. It will be an exciting time.”
This story was originally published on our sister publication, Intelligent Insurer.