As cyber incidents continue to top the concerns of the financial services sector, there is an increasing urgency to bolster defences against these evolving threats.
With the horizon set on 2025, insurers are being pushed to reassess and refine their strategies to stay ahead of emerging cyber risks. FAnews recently spoke with Ryan van de Coolwijk, Business Unit Head: Cyber, Collectables, and Digital Distribution at iTOO Special Risks, to gain insights into how insurers are preparing for the next wave of cyber threats.
Strategies for emerging cyber threats
Given that the Allianz Risk Barometer recently highlighted cyber incidents as a top concern, insurers are adapting their approaches to address these threats effectively.
Van de Coolwijk explains, “As cyber insurers, we constantly need to keep an eye on the changing risk landscape to ensure that we can best insure our clients.” The strategies being implemented include:
To bolster resilience against the next wave of cyber threats, insurers are focusing on reflective underwriting, which incorporates emerging risks identified through claims and industry trends and utilising advanced risk management tools by partnering with security providers to access cutting-edge technologies for proactive threat detection and valuable client insights.
Integration of advanced technologies
The integration of advanced technologies is crucial for effective cyber risk management. Van de Coolwijk highlights that “Apart from the external posture assessment tools which are useful in their area but limited in their scope, the partnerships we are engaged in with security providers are enabling us to access advanced technologies and tools.” These technologies include:
Policy updates and coverage options
Insurance policies are also evolving to address the changing cyber threat landscape.
Recent updates to insurance policies include an expansion of coverage for business email compromise (BEC) and the inclusion of protection against physical damage from cyber-attacks, addressing the rise in fraudulent transfers and attacks on operational technology.
He also added that partnerships with cybersecurity firms play a vital role in combating future cyber threats. He emphasises, “I firmly believe that cyber insurance should be part of a wider ecosystem with cybersecurity firms and by no means seen as a replacement to security.”
Challenges and market adaptations
Insurers face significant challenges in keeping pace with evolving cyber threats. Van de Coolwijk acknowledges that, “The biggest risk is not being able to keep pace with threats which impact on the commercial viability of the offering.”
To overcome these obstacles, insurers are focusing on proactive underwriting by adapting approaches based on emerging threats and past incidents, and continuous improvement through regular updates to risk management and incident response processes.
Looking ahead: emerging trends
Looking towards 2025, several trends and technologies are anticipated to impact the cyber risk landscape:
He concluded, “On the technology front, we are seeing more technologies coming out to protect from the viewpoint that you can’t guarantee that a malicious attacker won’t gain access, so how do you protect the data and environment once the attacker is in your environment.”
Writer’s thoughts
In an era where cyber threats are becoming increasingly sophisticated, insurers must go beyond traditional risk management approaches to stay resilient. Embracing innovation, fostering collaboration with cybersecurity experts, and continuously refining their strategies will be key to safeguarding clients and ensuring long-term sustainability in an unpredictable digital landscape. Do you agree? Please comment below, interact with us on X at @fanews_online or email me your thoughts myra@fanews.co.za
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