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Canadian Cyber Insurance in 2021 – Be Prepared!

Posted 1 year ago on · Permalink

“We all know what happened to businesses in 2020, and the impact it had on information technology management. Over a relatively short period of time last spring, entire workforces were sent home with whatever technology was available, hoping the lockdown was going to be a temporary measure that needed to be weathered, rather than adapted to.
Fast forward to Spring 2021, where the uncertainty and emotion surrounding COVID-19, combined with incredibly distracting home environments, has created the perfect opportunity for cybercriminals to flex new and improved ransomware and related capabilities, preying on the distracted workforce.
There are plenty of cybersecurity statistics that show why it is important to address, however, nothing makes the point as clearly as the claims being made against cyber liability insurance coverage over the past year. According to statistics published by the Office of the Superintendent of Financial Institutions (OSFI), the loss ratio related to cyber liability was 407.2% through the first three quarters of 2020, compared with 114.1% for the same period in the prior year. This means that insurers are paying out four time as much in claims as they are earning in premiums.
“We are seeing the impact on renewals and new insurance applications across multiple clients” said Jeff Dawley, President of Cybersecurity Compliance Corp., “Facing limited options against rising losses, some insurers are taking dramatic action, leaving clients with few options when it comes to meeting contractual requirements or just protecting against the financial impact of an attack.”
Driven in large part by a rise in successful ransomware attacks and successful phishing campaigns, insurers are re-evaluating their approach to the market. With limited options, they are choosing between increasing premiums, tightening underwriting criteria or exiting the market altogether.
In order to prepare for the inevitable consequences of this upward loss trend, companies should be evaluating their cybersecurity readiness and resilience using an assessment based on an industry-accepted framework. There are options ranging from one-time, static assessments to dynamic assessment solutions with improvement roadmaps, and the resulting information can be used by internal resources or consultants to help facilitate your next insurance renewal, while improving your overall cybersecurity in the process.”
– Jeff Dawley, Cybersecurity Compliance Corp.