Peter D. Hancock recently spoke, saying that this coverage is lagging behind what other forms of protection offer.
The chief executive officer of American International Group, Peter D. Hancock, has stated that when it comes to cyber insurance, the coverage has fallen behind the type of protection that is available through other types of policy.
Hancock expressed his opinions about this coverage against cyberattacks while speaking at a recent event.
While talking at New York University, Hancock expressed that “The largest coverage I’m aware of is for a bank that has about $400 million in coverage which is very small when you think about it. He pointed out that cyber insurance provides a smaller amount of protection than other types of coverage. He stated that “When you compare it to the amount of capacity that’s available for a complex chemical plant, refinery, offshore oil platform, the numbers are much, much higher.”
A number of recent examples of cyber insurance claims have suggested that Hancock is right.
A large example could be considered through Transocean, Ltd, which is the owner and operator of the Deepwater Horizon rig that exploded five years ago, this month, and that left a massive oil spill behind. That company carried $700 in general liability insurance through London market syndicates on top of $50 million in general liability policies at Ranger Insurance Co., according to documents submitted in their chain of court cases over payments following the disaster.
Comparatively, in 2013, Target Corp. suffered a massive data breach which will, when all is said and done, rack up a total cost of about $252 million in expenses. Its protection against this cyber attack extended as far as $90 million, leaving the company to foot the bill for the remaining $162 million.
Even when looking to the extreme limits of the type of protection that is available for cyber and data breach protection, it doesn’t get much higher than $500 million. That said, the average cyber insurance policy for large corporations is usually in the range of $100 million to $200 million. This, according to Marsh cyber product leader, Robert Parisi.