6 November 2015 Insurance

Innovation needed in cyber security: Guy Carp

Continued innovation is required to address the risk of cyber security, as concerns surrounding cyber intensify.

This is according to Guy Carpenter, in its fourth annual survey at the 2015 Property Casualty Insurers Association of America (PCIAA) annual meeting.

According to the broker, nearly half (49 percent) of the respondents noted cyber security as an area most in need of innovation, followed by big data management (27 percent), predictive analytics (14 percent), and catastrophe modelling (10 percent).

Cyber also claimed the top spot as the most threatening emerging risk, jumping to 65 percent from 40 percent in 2014. One-in-four professionals ranked climate change as the most threatening emerging risk, followed by terrorism (10 percent).

On potential challenges facing the industry in the coming year, undisciplined/unprofitable underwriting once again ranked as the leading threat to plans for growth, with 33 percent of respondents indicating so.

“Concerns around catastrophe / non-catastrophe losses rose slightly year over year, with 24 percent of respondents citing this as the biggest threat to plans for growth (versus 19 percent in 2014),” said Guy Carpenter.

Tim Gardner, chief executive officer (CEO) of US operations for Guy Carpenter, said: “Cyber risk, climate change and terrorism continue to pose a serious threat not only to the insurance industry, but also to governments, businesses and communities around the world.

“We as an industry have the opportunity to address these emerging risks head-on, with innovative solutions and new product development that can transform these potential challenges into growth opportunities. At Guy Carpenter, we continue to invest in the future by helping our clients see ahead of the curve in order to gain a sustained competitive advantage.”

The survey also found that nearly half (48 percent) of respondents believe new products present the most significant opportunity to expand business in 2016, up from 40 percent in 2014.

“This is followed by new geographic markets (24 percent), mergers and acquisitions (14 percent), talent acquisition (9 percent) and new distribution channels (5 percent),” said the broker.

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