It follows the firm recently identifying the seven major flaws in cyber insurance 

Mactavish has launched a new initiative to overcome problems recently identified with cyber policies.

The intiative called the Cyber Risk Consulting Practice is designed for corporates and helps businesses identify their risks and negiotiate the right cover. 

It follows the insurance governance firm recently revealing seven major flaws in commercial cyber insurance.

Mactavish is concerned that some organisations could be “mis-sold” policies and buy cover that does meet their needs.

Bruce Hepburn, chief executive at Mactavish, explained: “Cyber insurance is a new and untested financial product, and in many cases, it is complex and incomplete, and in need of major adaptation to provide reliable protection for a specific business’s exposures.”

New Practice

The new initiative claims to help clients by identifying less obvious cyber needs through different loss scenarios.

This will include looking at current contingency plans for cyber events, as well as potential liabilities and penalties their businesses could face.

Business interruption

Hepburn added: “For businesses that hold limited personal data and can operate with manual processes following systems interruption, most additional cyber cover may be of very limited value.”

But for specific exposures Hepburn said: “Specific exposures can also often be effectively and economically covered via amendment of existing insurance policies.”

He gave the example of professional indemnity (PI) insurance, which can sometimes cover damages payable to third parties for data breaches.

But he added that traditional policies often only respond to potential cyber events through careful amendments to their wording.

Cyber breaches have increased, according to research by Beaming, UK businesses were subjected to 52,596 attacks each on average in the three months to the end of June, the equivalent of 578 attempts a day or once every two and a half minutes.

And the threat of a cyber attack has been identified as the “most dangerous” risk by UK business leaders, this is according to a new study “Regional Risks for Doing Business 2018” by the World Economic Forum (WEF) which looked at perspectives on the impact of risk regionally in the private sector.