9 April 2013Analysis

Cyber surpasses weather as leading supply chain risk

Marsh announced the appointment of Matt McCabe, a former congressional advisor on cyber security, to the Network Security and Privacy Practice. McCabe joins as a senior vice president. He will be responsible for advising clients on emerging security trends and issues, in addition to the ways in which they can address their unique data and privacy needs.

Most recently, McCabe served as senior counsel to the US House of Representatives Committee on Homeland Security. He has also worked as a litigator specialising in M&A, securities and accounting fraud, and antitrust cases.

Bob Parisi, Marsh’s network security and privacy practice leader, spoke to Captive International about why the company is investing in their cyber security team and what the risk means for businesses.

How focused is Marsh on cyber risk?

For more than a decade, Marsh’s Network Security and Privacy Practice has been a trusted advisor to leading businesses, helping them address their unique data and privacy needs. From the creation of the first cyber policy forms to our newest innovation, CloudProtect, Marsh continues to move and shape the market on behalf of our clients.

Marsh’s growing Network Security and Privacy Practice, with more than 20 dedicated practitioners in the US and centres of excellence in New York, Portland, London, and Bermuda, has doubled over the past 12 months and will continue to expand to bring a deep bench of professionals to our clients in this important, ever-changing space.

Why invest in the cyber risk team now?

Today’s businesses face increasingly complex information and computer security. Data breaches, hacking threats, litigation, and increased regulation have broadened the spectrum of risk and deepened the potential loss that companies face in their daily operations. Navigating through these complex risks requires leadership, knowledge, and solutions.

Marsh’s continued investment in the area of cyber is a reflection of the evolving nature of the risk. The hiring of Matt McCabe, whose background is not insurance, is an example of how we are expanding our expertise in this area.

Also driving our investment is the growing demand from our clients for risk mitigation solutions. We saw a 33 percent increase in the number of clients purchasing cyber insurance in 2012.

How important will cyber risk be in the future?

Threats of a data breaches and hacking attacks will remain a risk for businesses for as long as they remain dependent on technology, data, and data privacy. It’s an operational risk that needs to be properly understood and managed. It is interesting to note that technology breaches now surpass adverse weather events as the chief disruption to companies’ supply chains.