Showing posts with label Cyber Insurance. Show all posts

Thursday, 15 November 2018

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Joint Statement: EU and U.S. insurance regulators continue the dialogue on cyber security, cyber insurance, the use of big data and intra-group transactions






  • Growing cyber threats, increasing power of big data as well as contagion risk from intra-group transactions in multi-national insurance groups are focus areas for risk-based and forward-looking supervision in the United States and the European Union
  • The Steering Committee of the EU -U.S. Insurance Dialogue Project set the scene for 2019 for further deepening the cooperation and mutual understanding of regulatory approaches and supervisory practices in these evolving and critical areas
  • The recent EU -U.S. Forum served as an important platform to share multiple perspectives on objectives, opportunities, challenges and risks in these key areas. 
Frankfurt, 14 November 2018 – On 10 November 2018, the European Insurance and Occupational Pensions Authority (EIOPA) together with the National Association of Insurance Commissioners (NAIC) and the Federal Insurance Office (FIO) of the U.S. Department of Treasury hosted the sixth EU- U.S. Forum in Luxembourg. Representatives from the industry, consumer organisations and regulators from the United States and the European Union discussed challenges and opportunities related to cyber risks, the use of big data, artificial intelligence and intra-group transactions in multi-national insurance groups.
Gabriel Bernardino, Chairman of EIOPA, said: "We particularly welcome cooperation with our American colleagues, building on successful past dialogue and now benefiting from deepening the mutual understanding of supervisory approaches and practices to address fast evolving cyber risks, increasing power of big data and the critical area of intra-group transactions. Considering the implications for the operational environment and the business models of insurers, globally, a collective response of supervisors is required to meet our primary objective which is the protection of policyholders and beneficiaries."
Katharine L. Wade, Commissioner, Connecticut Insurance Department, said: "The EU- U.S. Insurance Dialogue Project has led to an enhanced mutual understanding of our respective regulatory frameworks and initiatives in the areas of cyber security, cyber insurance, use of big data and intra-group transactions. Continued dialogue with our European colleagues in these key areas helps to ensure effective coordinated supervision of cross border insurance groups for the benefit of our policyholders."

Sunday, 5 August 2018

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Deeper understanding of cyber risk needed – A core challenge for the European Insurance Industry


European Insurance and Occupational Pensions Authority (EIOPA) published its report "Understanding Cyber Insurance - A Structured Dialogue with Insurance Companies" (EIOPA Understanding cyber insurance).
Cyber risk is a growing concern for in­stitutions, individuals, and financial mar­kets. In less than five years, it has surged to the top positions in the list of global risks for business. The increasing number of cyber incidents, the continued digital transfor­mation and new regulatory initiatives in the European Union are expected to raise awareness and to boost the demand for cyber insurance.
With the stand-alone cyber insurance market located predominately in the United States and only a fraction of the total market in Eu­rope, available reports and surveys focus on the global or the US insurance market. So far, very little attention has been paid to the European market. One of the key findings of the report confirms this fact, namely the need for a deeper under­standing of cyber risk, which is a core chal­lenge for the European insurance industry. This challenge generates or fosters other challenges, such as improper treatment of non-affirmative risks and difficulties to quantify risks, among others.
The outcome of this structured dialogue with the industry provides useful insights on the functioning, growth potential, challenges and risks of cyber insurance in Europe in the context of the expected growing importance of cyber insurance in the portfolios of (re)insurers. Although based on a limited sample, the report addresses important key findings, such as the clear need for improved understanding of cyber risk. This report is the first attempt by EIOPA to enhance the level of understanding of cyber risk underwriting with a focus on the European insurance market. Further work in this field is necessary. Therefore, EIOPA included a combination of qualitative and quantitative questions on cyber risk in its 2018 Insurance Stress Test.