Brokers must improve client service in cyber, says CFC

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Graeme Newman, chief innovation officer at CFC, said cyber risks are "still the same old risk, just presented in a new way".

Brokers should focus on understanding their clients’ specific cyber needs, according to CFC’s chief innovation officer Graeme Newman.

Speaking to Insurance Age at the CFC Cyber Symposium 2019, he said: “Brokers need to look at a claims proposition, so they know what it is that they are actually buying.

“Clients, particularly those in the small and mid-market space, are buying cyber for access to a set of services and so the quality of those services makes a difference, not necessarily the words on the page. That’s where I think the big differentiator is and it’s overlooked by most people.”

Knowledge
Newman stated that brokers can sometimes find the cyber space hard to understand because they think they require an in-depth knowledge of technology.

He explained: “Brokers need to have an appreciation for cyber risk as a concept, but I don’t think they need to necessarily understand the technology or security and that’s where people go wrong.

“They don’t have to understand how a firewall works or how intrusion detection works, just like they don’t actually need to know how a sprinkler system works or an alarm works to sell property insurance.

“It’s still the same old risk, just presented in a new way. The biggest source of claims is crime, and cyber is just crime in the twenty-first century.”

Experience
Newman closed the company’s Cyber Symposium by saying that, as 2019 draws to a close, the insurance industry will see a new phase in cyber.

He told Insurance Age that cyber claims are increasing either because cyber crime is increasing or because people are now better at detecting cyber crime.

“If someone has their own experience [of cyber crime], they can tell their story a lot more authentically. When you have never experienced it before, it can be really hard to associate,” Newman explained. 

Guidance
Earlier this week, CFC launched a cyber risk heat map, ranking the severity of different industries’ exposures to business interruption, privacy, and cyber crime. 

This followed a cyber good practice guide launched by the Society of Insurance Broking on 11 November, explaining what brokers need to do to ensure the cyber cover they recommend is suitable for their clients’ needs.

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