Louisiana Commissioner of Insurance Jim Donelon says there are three kinds of businesses: Those that have experienced a data breach and know about it, those that have been breached but don’t realize it, and those that haven’t been breached yet but will.
Donelon has been urging business owners, first and foremost, to do everything they can to protect themselves from cyberattacks.
Thanks to breaches at high-profile companies like Target and the health insurer Anthem, that message is starting to sink in, Donelon tells Business Report in a feature from its current issue.
Cyber liability insurance is perhaps the fastest-growing type of insurance in America today. PricewaterhouseCoopers, an international consulting firm, estimates that annual gross written premiums will increase from about $2.5 billion in 2015 to about $7.5 billion by the end of the decade.
The economic opportunity in this space for insurance companies, agents and brokers appears to be tremendous.
But many insurers are wary, PwC says. There isn’t much publicly available data on the scale and financial impact of cyberattacks, the nature of the threat is constantly changing and breaches can remain undetected for months or even years. Determining how much exposure a client has and how to price that risk can be a challenge.
Harold Williams, owner of 1st Team Insurance Agency in Baton Rouge, says he has been selling cyber liability insurance for several years and has been getting more inquiries about it recently.
Business owners should keep in mind not only the monetary value of their information, but also the public relations hit they would take in the event of a data breach, Williams says.
“If you have customers’ personal information, you will want that protected,” he says. “Nobody will want to do business with you if they think their personal information is not protected.”
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