Cyber, the fast moving target
2016 Benchmarking views and attitudes by industry
The ongoing debate around cyber risk and how to get the right cover for a company’s cyber risk exposures led Aon to undertake a detailed study of what large companies across various industries are doing to mitigate such threats.
Aon’s 2016 Captive Cyber Survey offers analysis on top cyber risk concerns, risk assessment approaches, attitudes toward cyber insurance and policy cover and structure. The survey gathered input from risk managers and directors of 127 captive insurance companies.
The 2016 findings, presented in both aggregate and by industry, will allow organisations to gain insights into this mounting threat, benchmark their risk management practices, spark new solution discussions and identify approaches that include exploring a captive or retail market cyber solution to increase their preparedness.
Key highlights include:
- The costs of business interruption due to a breach is the top cyber risk concern for businesses across all industries
- 61 percent of survey respondents buy cyber limits in the USD$10-25 million range, but overall 60 percent of large companies don’t buy cyber insurance at all
- Of those that do, 68 percent of companies surveyed buy cyber for balance sheet protection, closely followed by ensuring due diligence comfort for the board
- Only 25 percent of respondents that buy limits are confident they comply with international best practices and standards for information security governance
- 95 percent of companies state clear policy wording as the most important issue in the cyber risk market, and 75 percent of large companies express concerns about the loss adjustment process
What is a captive?
A captive is a bona fide insurance or reinsurance company owned by a non-insurance company parent and which insures or reinsures the risks of its parent and/or affiliated companies. It is similar in principle to a conventional insurance company and usually formed in a specialised regulatory environment (‘domicile’). Globally, Aon’s Captive & Insurance Management team manages approximately 1,100 insurance entities worldwide, including captives, protected and incorporated cell facilities, special purpose vehicles, and specialist insurance and reinsurance companies.