Hiscox expands cyber offering with new Industry Loss Warranty product
First-of-its-kind cyber ILW helps address uncertainty around cyber tail risk for (re)insurers. Hiscox has continued its focus on cyber with the launch of a new cyber Industry Loss Warranty (ILW)...
This new product responds to an aggregation of cyber losses throughout the year and helps address the uncertainty around cyber tail risk for (re)insurers. It can therefore act as an effective hedging mechanism for cyber underwriters. While ILWs are common within the property reinsurance and retro markets, this is the first that responds specifically to cyber losses.
ILWs allow an organisation to take out coverage based on the total insured industry loss, rather than the losses of a specific insurer. With ILWs, a third party is required to be an objective decision-maker on the size of the market loss, which in this case is the PCS Global Cyber Index.
Mike Krefta, Hiscox Re & ILS CEO, explained: “We have big ambitions in cyber and our new cyber ILW is another important step forward in developing that market. We believe innovations like this demonstrate our technical abilities and willingness to be a market leader in emerging risks.”
The cyber ILW is part of Hiscox’s ongoing drive towards product innovation and bespoke client solutions. Other examples include FloodXtra, which Hiscox launched at the end of last year to provide reinsurance protection to US insurers in a deregulating flood insurance market, and FloodPlus, its London Market insurance product for US coverholders.