Arch ready for deeper dive into cyber as corporate IT security turns new corner
Bermuda-based re/insurer Arch Capital is ready for a deeper dive into cyber exposures on a rising sense that the corporate world has gotten serious on security in ways yet to be recognised by a shell-shocked insurance industry.
“We are bullish on cyber,” CEO Marc Grandisson (pictured) told a conference for market analysts and investors hosted by Bank of America Securities. “We are doing some smaller risk; we are looking to do some bigger risk.”
The fear that has shrunk cyber insurance capacity is the very fear that has reformed corporate behavior to render “the one line of business where moral hazard is really minimized,” Grandisson said. Corporate interests are fully aligned with those of the insurers covering them, he feels.
“Fear is driving the market right now,” he said. “This is the kind of market that Arch will do well in.”
Arch could help but investigate conditions in cyber given the double- and triple-digit rate increases that surged through the market in 2021. A closer look under the hood showed a strong move on terms and conditions, “a lot of oversight”, and skyrocketing levels of “insight and questioning.”
Grandisson tips his hat to the market’s concern that the next stage in cyber could prove widespread, but vows prudence. “We are keeping track of our aggregates, but it is going to be manageable,” he said of the potential fall-out of any potential “the big event”.
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