Just four years after cyberinsurance policies were first introduced to the specialty market, losses are already piling up and causing some insurers to rethink their strategies, according to a broker who spoke at a recent conference.
If a carrier has 1,000 cyber-policies, it has over 50 claims by now, reported Philip Norton, president of the professional liability division of Arthur J. Gallagher & Company in Itasca, Ill., during the American Conference Institute’s Online Liability Conference. The average claim is about $1 million, he added, predicting higher future amounts, during a session entitled, "Show Me the Losses."
Loss ratios are already significant, he said, asserting that insurers "need to drive an average premium of $35,000 to support the losses they have already."
Insurers at the conference said the majority of claims so far relate to liability for Web content.
