The business community is evaluating risk through a transformed lens, in light of COVID-19. The (re)insurance sector is also identifying the lessons learned about unforeseen aggregated exposure. The systemic nature of both affirmative and silent cyber risk has long been one of its most defining, and challenging, characteristics, according to Guy Carpenter colleagues Will Garland, President, Centers of Excellence, and Erica Davis, North America Cyber Center of Excellence Leader, Guy Carpenter.

When the impacts of COVID-19 were evidenced in 2020, we identified parallels to cyber exposure unfold through this other newly emerging industry risk:

• Potential for an aggregated global event with no regional boundaries
• Cascading effects on direct and indirect supply chains
• Multi-prong industry impact manifesting across property, casualty and specialty lines of business
• Policy language that may not explicitly address underwriting intent, or may be triggered inadvertently
• Sweeping financial consequences that could ultimately be an existential threat.

The far-reaching impacts of this event have yielded valuable insights on the criticality of business continuity planning, supply chain…

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The insurability of systemic cyber risk will be one of the defining issues of the next decade for the (re)insurance sector. Rapid technological changes and digitalization in particular have already transformed the characteristics of risks assumed by the (re)insurance market.

Businesses continue to embrace technological innovation despite the fact that doing so may lead to the emergence of new and unforeseen risks, according to Guy Carpenter colleagues Will Garland, President, Centers of Excellence, and Erica Davis, North America Cyber Center of Excellence Leader, Guy Carpenter. As cyber risk is one of the most swiftly evolving perils in the industry, carriers should carefully manage the exposures – and not only for competitive advantage. As regulators formalize capital requirements and qualitative measurements of risk appetite in this rapidly evolving market, companies will be required to enhance cyber underwriting and reinsurance strategies, leverage innovative modeling capabilities and develop technical and underwriting risk talent to continue offering clients the best security possible.

As companies depend more on technology to conduct business, they are also increasingly…

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