Insurtech Insights: Why Agents Are Exposed When They Don't Offer Stand-Alone Cyber

Jan 4, 2023 Insurance, Insurtech

Insurtech Insights: Why Agents Are Exposed When They Don't Offer Stand-Alone Cyber

An insurance agent discussing the latest insurtech insights with her client

In today's digital age, data breaches and cyber attacks are becoming increasingly common, with sophisticated hackers targeting businesses of all sizes. As a result, more companies are seriously considering purchasing a cyber insurance policies. Yet many insurance agents are still reluctant to sell these policies because they need to fully understand them, but they can be complex and challenging to explain to customers. 

With the right training and support, agents and brokers can help clients understand why adequate cyber coverage is essential, as well as the complexities that come with cyber policies. When customers receive this education from trusted agents, it gives them extra confidence in their decisions and encourages them to insure parts of their business that may have previously been overlooked.

In this article, we’ll explore the insurtech insights you need to sell more cyber policies to clients. 

The Current Insurance Landscape Doesn’t Adequately Protect Against Cyber Risks

Despite the growing threat of cyber attacks, many insurance companies are not taking on enough risk to offer adequate protection. This is because the current landscape is focused on traditional risks, such as state-required coverages such as Workers Compensation and General Liability. As a result, there needs to be more understanding of cyber risks, which are often complex and ever-changing. 

In addition, many insurance policies have exclusions for cyber risks or offer limited coverage. This leaves businesses vulnerable to the financial fallout of a cyber-attack, making cyber insurance a must-have for any company that handles valuable data. 

Stand-Alone Cyber Policies Are Becoming Increasingly Popular as a Result

With the majority of the world connected to the internet, cyber-attacks have become a fact of life for businesses of all sizes and industries. Business owners need to be aware that in this digital climate, it’s no longer a question of if but when their company will experience a cyber event and how severe it will be. 

In the past, businesses have typically relied on their general liability policy to cover any losses incurred during a data breach. However, as the frequency and sophistication of cyber-attacks continue to increase, insurers have become more selective about what they are willing to cover. As a result, stand-alone cyber policies are becoming necessary coverage for businesses.

As the frequency and sophistication of cyberattacks continue to rise, more and more businesses are turning to cyber insurance policies to protect themselves. These policies typically cover expenses related to data breaches, such as notification costs, credit monitoring, public relations, business interruption, and extortion. Stand-alone cyber policies are tailored to the specific needs of a business, making them an increasingly attractive option for companies looking to protect themselves from the growing threat of cybercrime.

Why More Brokers Should Start Selling Stand-Alone Cyber Policies to Clients

Brokers that offer standalone cyber policies not only protect their clients from potential cyber risks, but they also shield themselves from being sued for an alleged error or omission related to not enough or inadequate insurance. By being proactive and offering these types of policies, insurance agencies send a message to their clients that they are concerned about their well-being and are willing to take extra measures to protect them. In today's increasingly data-dependent world, standalone cyber policies are becoming more common and, as a result, more important for insurance agencies to offer. By doing so, they can continue to build trust with their clients and mitigate their own legal risk.

Another benefit of selling cyber insurance is that it can help improve client retention. Because cyber threats are constantly evolving, having a cyber insurance policy provides peace of mind for clients and helps know that their assets are protected. 

If a client does experience a breach or other cyber incident, having insurance can make the recovery process much smoother and less stressful. As a result, clients who have cyber insurance are less likely to shop around for a new agent after an incident occurs.

By offering stand-alone cyber policies, insurance agents can enjoy increased revenue and improved client retention while helping their clients protect themselves from the ever-growing threat of cybercrime.

Paving the Way to Make Selling Cyber Policies an Easier Decision for Agents

Cyber insurance is a growing market expected to reach $32.6 billion by 2028. As an insurance agent, you should consider becoming well-versed in the newest and biggest threat to modern commerce. By selling stand-alone cyber insurance policies, you can help protect your clients' businesses from data breaches and other online threats, shield yourself from e and o legal action, and gain clients' confidence with your expertise.. And with our help, you can do it profitably for both of you. 

Contact us today to learn more about how we can work together to bring cyber insurance to your clients.

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