Cyber risk behind rising insurtech investment

Sixty-three insurtech deals with a total value of US$1.59bn were announced world-wide in Q4, 2018 -- the second-highest quarter behind the exceptional second quarter of 2015, according to figures from Willis Towers Watson.

The advisory firm’s latest Quarterly InsurTech Briefing Attributes this rise in investment to the need to manage cyber risk.

Global head of cyber at Willis Re, Mark Synnott says there is “healthy ecosystem” of insurtech firms, insurers, reinsurers and brokers working to quantify and price individual and portfolio cyber risk under affirmative coverage, but that more work needs to be done to address silent cyber, since potential accumulation exposure is enormous. Work is underway to address this issue, he says.

“We have a module in our PRISM-Re cyber model that assesses exposure to silent cyber and several insurtechs have developed software that deploys policy-analysis algorithms that help insurers expose and quantify silent cyber coverage. As the cyber threat grows, such tools will become increasingly valuable and commonplace.”

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