Demand for suitable insurance cover and prevention and recovery services is growing exponentially. "The losses from cyber-attacks clearly demonstrate that cyber constitutes one of the biggest global risks. It presents the insurance industry with both a challenge and an opportunity to develop and offer solutions for cyber risks," Doris HOEPKE said.
Digitalisation is progressing at a tremendous pace in all industries, providing means of increased efficiency and improving client satisfaction, but also changing the risk landscapes of companies. Cyber risks are without a doubt one of today's greatest threats. Unlike traditional lines of insurance such as Nat Cat, fire and motor, cyber risks are global: no market, sector, or company is spared, irrespective of its size.
HOEPKE emphasized, "Protection against cyber risks could successively develop into an important field of business in its own right. As a global reinsurer, we accept the challenge of drawing up solutions for this new risk profile. Not to do this would be the biggest risk of all."
Cyber risks present the insurance industry with significant challenges. Very little long-term loss data is available, making it impossible to conduct a risk assessment using conventional models. In addition, the risks themselves are changing as digitalization gains pace. This calls for flexible solutions that offer much more than just insurance coverage. Unknown cyber risks can even be found in many existing traditional insurance policies, as the contractual conditions either did not exclude these risks or did not draft the exclusions with sufficient accuracy.
Small and medium-sized enterprises and primary insurers in particular, require support. Alongside insurance cover, Munich Re's offering includes services related to technical analysis, prevention measures, ongoing review of the security standards of technical equipment, forensic investigation following a loss, and the recovery of data. In order to best meet these demands, Munich Re has cooperated and partnered up with numerous highly specialised technology companies in recent years. This secures access to the knowledge that is required for our holistic approach. Working closely with cedants allows us to better analyse client needs and draw up tailor-made solutions.