The Challenges to Effective Cyber Risk Transfer: Guest blog from Towne Insurance

Post # 3 Denial

Guest blog by Danny Plante, EVP, Towne Insurance

…and then there is denial.

Given the fact that the insurance brokerage community (in many cases) is intimidated by, and in some cases ambivalent about, cyber risk…and the buying public (in many cases) has reservations about both their susceptibility to the exposure and the value proposition afforded by a new expense, what otherwise seems as though it should be a bonanza of insurance solutions cheerfully seeking cyber problems to solve, ends up as something far from it.

More typically, and in the absence of a compliance driven need, business owners and their agents leave cyber exposure in a never-land of vague awareness for which an inexpensive and equally ineffective, in-name-only, extension of coverage seems suited. What follows is ire and rationalization should a significant cyber casualty occur. Our friends at Sera Brynn and their attorneys see this all the time. As do their clients….which is typically how they became clients.

The point here is that insuring cyber exposure correctly takes some concentration and effort. Although it is insurance, it is hardly a part of the vernacular. And while insurers acknowledge the exposure as an opportunity, they are understandably sheepish about committing resources to a hazard so quick to change, and entailing such potential severity. Moreover, they are less than enthusiastic about their reliance on (in many cases) analog broker public for an accurate characterization of the risk at hand.

Accordingly, one should allow for the possibility that transferring or financing the cyber exposure may benefit from a provider outside the usual brokerage relationship…a specialist, if you will.

Towne Insurance has aligned itself with one of the best cyber security firms in the country, and collaborated with them extensively on what they get called about most often…uninsured cyber exposure.

Our interests lie in competent response to matters of compliance (DFARS for example), assisting the middle market with well thought and robust solutions for well understand exposure (breach response, extortion, property, consequential loss), and assisting with gaps and wrap around solutions to complement ERM best practices or to build cyber difference-in-conditions solutions.

If you would like to get in touch with Towne Insurance, call 757-502-4953 or email