Cyber market has momentum; coverage needs to be more explicit, says Hannover Re
The cyber market is exhibiting good momentum, with efforts being made to ensure the coverage is more explicit, Sven Althoff, member of the executive board for Hannover Re, told SIRC Today.
“Whether it’s Lloyd’s or other major cyber insurers, they are showing a much stronger effort to make it affirmative or firmly exclusive,” Althoff said.
“We are less concerned about the bespoke side of the coverage there has always been a market for that—but there is concern about the silent part of the exposure, and from that point of view we need those initiatives to be clearer on whether they are willing to provide the coverage or not.”
He added that cyber is an ever-evolving exposure. This, combined with the fact that the market has not yet accumulated a lot of data on cyber losses, means cyber cover is still lagging when compared to the capabilities the industry has in areas such as property cat.
“We must accumulate the data in order to become better as an industry at dealing with those risks,” Althoff said.
Michael Marx, head of Asia-Pacific for Hannover Re, added that the demand for cyber insurance will shift more from the big companies to the SME sector.
“The industry has to have a set of products meeting the new demand coming up, and it needs to have clever claims management around cyber,” he said.
Discussing the levels of insurance penetration in Asia, Althoff said that while there are good levels on the commercial and industrial risk side, penetration for SME business and personal lines is still relatively low compared with Europe.
“We are trying, together with our local partners be that brokers or insurance companies to bring more products and more capability into the region to offer suitable solutions in those lines,” he said.
He added that Hannover Re is strongly dedicated to the region as a whole.
“Over the next couple of years we will be investing into the region even more than in the past not through M&A but through investing in our infrastructure, adding more resources to cover things such as data analytics, cyber, loss prevention and claims handling,” he concluded.
