Mike Palotay, senior vice president, NAS Insurance
Cyber insurance carriers are increasing overall capacity despite claims reaching their “highest point ever” according to NAS senior vice president Mike Palotay.
However, the majority of the fresh capacity in the market was new to cyber and did not have claims or pricing history, Palotay cautioned the Advisen Cyber Risk Insights conference in San Francisco on March 11.
Claims are rising in pockets of the sector, however, with panelists at the conference noting that corporations in the retail and healthcare sectors could be problematic risks to place.
Susan Young, vice president at Marsh said that retail capacity was “limited” following the high-profile losses at Target and Neiman Marcus.
“Healthcare is sometimes challenging as well,” Young noted. “Carriers’ views vary depending on the claims history andhow data’s protected. Insurers are taking a harder look now at controls and loss history.”
However, Willis vice president Karl Pedersen thanked carriers for continuing to offer coverage “in the middle of a perfect storm”.
“Carriers are willing to put up $10-20 million placements in tough conditions. Thank you,” Pedersen said.
Pedersen added that capacity was continuing to increase, noting that towers of cover could reach $300-400 million for the larger risks.
However, NAS’ Palotay lamented that some larger companies were still choosing not to buy cyber cover. He noted that smaller companies were starting to buy cyber insurance, including smaller utility companies, credit unions, medical groups and schools.
“Cyber insurance purchase is starting to percolate down through the corporate sector,” he said.
Notable sectors that are still not buying cyber insurance include some larger companies, third party administrators and law firms, Palotay said.
Rebecca Bole is EVP & Editor-in-Chief at Advisen. She has nearly 20 years of experience in the international insurance markets, both as an underwriter and a journalist. Contact Rebecca at [email protected].
