Other parts of this series:
Partnerships are increasingly important for insurers to deliver better outcomes—especially when it comes to accurately pricing and effectively servicing cyber insurance.
As more and more carriers enter the cyber insurance market, many are thinking about predictive modeling and adjunct services. These are all important, but not as important as having a plan for when losses exceed premiums. I call this the pivot.
Getting back to risk-based pricing is one way to prepare for the pivot. Another crucial way is to help clients be more secure. That is, isn’t enough to simply write the risk—carriers must also help their customers improve security practices.
Carriers must help customers prevent cyber risks
Partnerships with security vendors is natural, since security vendors are likely to have more access to the details of a potential policyholder’s security processes and vulnerabilities. Indeed, some security vendors are already bundling cyber insurance with their products and services, almost like a warranty.
Consider the partnership among Apple, Cisco, Allianz and Aon that provides cyber insurance for customers that use both Apple and Cisco products. It enables Allianz to position itself as a “living business”: to expand the insurance value chain in response to market changes, offer more points of personalized customer engagement, and improve outcomes for customers and carriers. Importantly, by partnering with Cisco and Aon, Allianz can tap into security expertise to help protect customers, and increase access to critical information that can help it better understand the risk.
Security testing is essential. It’s not enough to ask questions—carriers have to proactively test and “white hat” hack customers’ defenses. That’s the idea behind programs like bug bounties, which offer a reward for those who find and report vulnerabilities, such as the one that helped a mobile phone provider identify an unsecured subdomain with user information.
Education can also help customers prevent cyber risks. For example, Hiscox launched a cyber risk academy to help its customers better protect themselves.
Another approach is to partner with organizations that can help when breaches occur, especially legal counsel, IT forensics and PR firms. For example, Beazley announced its partnership with law and PR firms. In the event of a breach, this enables it to help affected customers address the situation expeditiously and expertly.
Next week, we’ll look at three steps that carriers can take to tap into the cyber insurance opportunity. To discuss how Accenture can help carriers forge strategic partnerships to extend the cyber insurance value chain, please get in touch.