By 
Allianz Commercial’s Complex Claims Handler, Mukondeleli Masiza, delivered crucial insights on cyber risk mitigation at the SNG Grant Thornton Cyber Security Awareness Summit, held in Sandton, Johannesburg recently.
In her presentation, titled “Risk Transfer as a Tool in Cyber Risk Mitigation: Cushioning the Blow through Cyber Insurance,” Masiza addressed the rising trends in cyber claims and effective strategies for mitigating cyber risks.
According to the Allianz Commercial Cyber Security Resilience Report for 2024, there has been a significant increase in both the frequency and severity of cyber claims. Large cyber claims, defined as those over €1 million, surged by 14% in the first half of 2024, while their severity escalated by 17%.
RELATED: Allianz Risk Barometer: Businesses in Nigeria concerned about regulatory, cyber, economic risks
Proactive Measures for Cyber Risk Mitigation
Masiza emphasized the importance of proactive measures such as early detection, swift action, and risk transfer solutions. “Early detection minimizes financial and reputational impact by allowing for quicker isolation of impacted systems and data,” she noted. “Detection tools automate and expedite tasks such as forensics and notification, improving the overall crisis management process.” Allianz Commercial’s findings indicate that organizations deploying cybersecurity AI and automation reduced the cost of a data breach by around $2 million on average.
Swift Action and Preparedness
Highlighting the role of swift action, Masiza recommended, “Robust incident response plans and regular drills ensure that teams are prepared. Swift action following early detection can stop a cyber incident from escalating, facilitating faster recovery and restoration of normal operations.”
The Role of Cyber Insurance
Masiza underscored the importance of cyber insurance, stating, “Cyber insurance provides financial coverage for various costs associated with data breaches, including IT forensic investigations, data recovery, and system restoration. Apart from the benefits of the cover provided, insurers can also offer valuable advice on loss prevention and mitigation, along with access to expert consultants and response teams.”
Support and Coverage
She further highlighted the comprehensive support provided when an insured reports a cyber breach. “Upon reporting a new incident, the Allianz Commercial claims team swiftly engages with the affected company to assess the situation and implement containment measures. They coordinate with incident response teams, including IT forensic experts, attorneys, and PR specialists as needed, to conduct thorough investigations and provide the necessary support.”
Underwriting Considerations
Masiza provided an overview of underwriting considerations, advising that factors such as the company’s industry, size, risk profile, and existing cybersecurity measures are evaluated during the underwriting process. Important considerations include data governance standards, transparency regarding the use of consumer data, and cybersecurity measures within the supply chain.
Guidance for Securing Cyber Insurance
She also offered guidance on securing cyber-related cover, emphasizing the role of experienced brokers. “Brokers play a vital role in explaining complex insurance terms, assessing specific business needs, tailoring policies, and conducting thorough risk assessments to identify potential vulnerabilities and recommend mitigation strategies. Companies looking to secure cyber cover should enlist the services of an experienced broker with a history of placing this type of cover, as it is quite specialized.”
Protecting Business Dreams
“Allianz Commercial understands that insurance is designed to protect the dreams of business owners and the families dependent on the salaries earned by the employees of such entities. A huge part of our role is to protect those dreams by ensuring that our Insured is up and running as soon as possible,” Masiza concluded.
Join the Allianz Commercial Webinar on Cyber Security Resilience
To further share how companies can best prepare and respond to cyber-attacks, Allianz Commercial is hosting its Cyber Security Resilience 2024 webinar on November 5, 2024, from 4 – 5 pm CET. During this 1-hour session, Allianz Commercial leading experts will discuss the latest cyber claims trends, loss drivers, and provide insights on how companies can best prepare and respond to these developments. Speakers include Marek Stanislawski, Allianz Commercial Global Cyber Underwriting Lead; Michael Daum, Allianz Commercial Global Head of Cyber Claims; Sabrina Sexton, Allianz Commercial Cyber Underwriting Lead SME and MidCorp; Tresa Stephens, Allianz Commercial Regional Head of Cyber North America; and Rishi Baviskar, Allianz Commercial Global Head of Cyber Risk Consulting.
