Building cyber solutions in a growing, multi billion-dollar market
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Losses faced by victims of cyber-attacks are increasing. So it is not surprising that many industry sources are seeing projected growth rates of the market of around 30-35% over the coming years. At Swiss Re our current estimate for the global cyber premium is around USD 5 billion.
To help our clients capture this opportunity, at Swiss Re we've shaped our approach to product development around listening to our clients and collaboration for the joint development for new products. This collaborative approach is gaining traction because we help create the right environment around the client company's development team.
This is especially true when an insurer is cost-conscious and may not have the resources to back a full-time innovation team or when there is a need to complement capabilities. The right partners can unlock access to data and tools to evaluate the risks. Partnerships will bring in added market experience and build relationships to the right advisors who can develop an end to end proposition with a solid business model.
A recent example of this approach was our partnership with Baloise, who were looking to strengthen cyber coverage for Small and Medium Enterprises in Switzerland, and other continental European markets.
Baloise is a strong insurance brand in a market full of opportunity. Switzerland has a strong SME market in general. According to a 2018 report from the Swiss Bureau for Statistics, over 90% of all companies in Switzerland are SME's - constituting nearly a quarter of the Swiss workforce. When it comes to cyber insurance, the demand in this segment is getting stronger as many small and medium-sized enterprises realise that they are just as vulnerable as any larger firm.
In order to provide a solution for these companies, Baloise set out to develop insurance products that are simple, easy to understand and that really fit the customer. They needed to adapt their existing processes and products while keeping costs in line. They knew their market and had the talent to work on the product – but they needed a trusted partner to bring the global perspective.
Swiss Re's team took the time to listen and gain an understanding of their challenge. Based on this, we proposed a comprehensive solution which includes Swiss Re's Cyber Product Suite and a partnership. The Cyber Product Suite is a collection of tools around the development of the cyber proposition coupled with a team of cyber experts. The partnership extended beyond consulting, as a reinsurer we backed our knowledge with a share of the final risk.
And the result? Baloise is now in-market with comprehensive product that is based on a sound understanding of the risks, a unique risk scoring system and costing methodology, policy wording and the confidence that their product is backed by Swiss Re.
Our dedicated EMEA Solutions team is committed to taking this work forward. if you are interested in other examples or ideas, please feel free to reach out to Annkathrin Stephan or Lydia Pomp to find out more about how we can help build the future of insurance.