Lloyd’s updates cyber risk code

Lloyd’s is set to introduce a new cyber risk code and undertake a data collection exercise to assess syndicates’ aggregation of exposures.

This is according to a market bulletin from Lloyd’s which said that following consultation with the market, Lloyd’s is revising its approach to allow the better monitoring of cyber risks by managing agents and Lloyd’s.

“For the insurance industry, this is an area of new and rapidly growing risk where the Lloyd’s market is showing innovation and bringing its specialist insurance expertise to bear. We are keen for Lloyd’s underwriters to continue to take that lead,” said Tom Bolt, director of performance management.

“However, while the underwriting of cyber risks provides opportunities for Lloyd’s syndicates,

Lloyd’s is concerned that without proper controls there exists a material risk of a dangerous aggregation of exposure in the market. Lloyd’s is also concerned that cyber risk may not be being properly priced for nor the exposures adequately quantified by managing agents.”