CICA: machine speed cybercrimes drive innovation
Commercial policies and traditional market solutions continue to struggle with the pace of shifting and evolving cyber risks in today’s environment, a panel at CICA 2023 told attendees.
The panel, which was made up of Stephen Cardot, captive owner at CloudCover Re, Aaron Hillebrandt, actuary at Pinnacle Actuarial Resources, Nick Pearson, vice president at BMS Group, and Michael Steep, founder of Stanford Disruptive Technology Program, Transform Innovation Ventures, specifically looked at cyber in captives.
Steep stressed that rapidly evolving technology is driving up the amount of data involved in insurance to huge levels. In turn this massive amount of data is creating unprecedented vulnerabilities.
To make matters worse, the bad actors who carry out cyber attacks are attacking at machine speed, measured at times in milliseconds. This is far faster than human cyber teams can react and therefore creates a cyber risk gap.
According to the panel many companies are developing new and innovative solutions to address these coverage issues through captive insurance companies. Whether it is large organisations electing to finance their first-party risk through their own captive, or a third-party offering captive solutions to their network, captives are becoming the first and sometimes only line of defence against cybercrime.
The panel also said that if insurers can work out how to respond to these rapidly changing attacks then there could be a huge opportunity for it. They pointed out that underwriting discipline has been increasing and that there is a greater focus on risk control, such as IT security vulnerabilities and reaction to cyber attacks.
Cardot also said that there is a solution on the horizon, with machine learning and autonomous intelligence technology being developed that can match the speed of cyber attacks and beat it back in microseconds.