Ensuring Cybersecurity Protection | CRC Insurance | FF Virtual Arena Event #338
In the ever-evolving world of cybersecurity, a new player is making waves - parametric cyber insurance. This innovative approach to risk management is gaining traction as a faster, more flexible solution that can complement traditional cyber coverage, improve claims experience, and address new cyber exposures.
Parametric cyber insurance, as explained by industry experts, provides quicker payouts to policyholders when specific, pre-agreed parameters or triggers are met. This feature is particularly beneficial for cyber risks, where losses such as downtime from an attack can be difficult to quantify and delay settlements.
Garrett Koehn, President and Chief Innovation Officer at CRC Insurance Services, is one such industry expert who has been actively involved in the implementation of parametric cyber insurance. Despite stepping back from his role as President, Koehn continues to work with CRC Insurance, leveraging his extensive experience in the Insurtech market.
Koehn's role in CRC's Executive Pro Group places him at the forefront of CRC's cybersecurity work. Over the past eight years, he has focused on the Insurtech market, often partnering with companies whose visions align with CRC's. These partnerships allow CRC Insurance Services to tap into innovations that might otherwise be cost-prohibitive or time-intensive to develop internally.
The potential benefits of parametric cyber insurance are manifold. For instance, it aids business recovery from cyber events without waiting for traditional claims processing, reducing financial strain. Transparency and predictability are also key advantages, as fixed payouts according to measurable triggers avoid disputes over claim amounts and speed resolution.
Moreover, parametric policies fill gaps, especially for emerging risks like AI-related attacks and vendor disruptions, as insurers adapt to evolving cyber threats. They also help cover cyber perils like downtime or cascaded global supply chain effects that are challenging under traditional indemnity-based policies.
However, challenges remain, primarily in establishing robust distribution ecosystems and developing accurate models for cyber event triggers. As the cyber risk landscape grows more complex with AI-driven attacks, these issues become increasingly critical.
Despite these challenges, reinsurance markets show strong interest due to the no-tail risk nature of parametrics, which makes capital raising easier. The insurance industry, including CRC Insurance Services, which covers a range of insurance areas including property, casualty, benefits, and life insurance, is shifting towards more flexible ecosystems, with financial services and Insurtech collaborating more closely.
In summary, parametric cyber insurance is currently gaining traction as a risk mitigant in an increasingly complex cyber insurance market driven by climate change, AI, and systemic digital risks. As the industry continues to evolve, it is likely that parametric insurance will play an increasingly important role in supporting businesses facing cyber threats.
Ffnews.com reported that Garrett Koehn, a former President and current Chief Innovation Officer at CRC Insurance Services, is working to implement parametric cyber insurance, a new approach to risk management that complements traditional cyber coverage and offers faster payouts when specific triggers are met. This insurance is beneficial for businesses as it aids recovery from cyber events without delay and provides transparency and predictability in payouts.
In the ever-changing landscape of cybersecurity, CRc Insurance Services, a company covering areas like finance, technology, property, casualty, benefits, and life insurance, is shifting towards more flexible ecosystems, collaborating more closely with Insurtech companies to adapt to emerging risks like AI-related attacks and vendor disruptions.
