This week Lloyd’s of London issued a new report, which said that the potential loss to the insurance industry from a global cyber-attack, could be as high as $53bn.
The number puts cyber exposure potentially beyond the range of recent natural catastrophes such as Hurricane Katrina, which resulted in the largest single loss in the history of insurance at $41.1bn according to the Insurance Information Institute.
Carriers are looking for ways to calculate their risk exposure. Some are conducting intelligent, automated contract review; others have yet to decide on an action plan. This lack of certainty owes a lot to the fact that it would take thousands of man-hours to check all the clauses, write backs and exclusions which may or may not be present in policy wordings.
Last year, regulators began to take an interest in this issue publicly. The Franchise Performance Directorate at Lloyd’s of London asked its members to provide a PML (probable maximum loss) number for cyber exposure in April 2016.
Exari was able to support a number of (re)insurers to deliver a robust response to the FPD request. By deploying intelligent, automated contract review software, underwriters have been able to arrive at a number they, and the regulator, can rely upon quickly.
Furthermore, Exari’s insurance contract solution can give a fast and automated way for creating slips, quotes, policies, and forms in a web-based questionnaire. Having all these documents in one central repository enables powerful analysis of the data buried within them.
With cyberattacks being a huge threat to all industries it’s important for any business to have control and visibility into their contracts. We always hope that it won’t happen to us, but if it did, how would it affect your business? How is your company protected? If you don’t have these answers then you’ll need to take a deep dive into your contracts. In order to do that, you’ll need a large team or a one-step contract review solution. Either way, you better get started before it’s too late.