I was once given the foundational advice: "An underwriter has four key jobs: market, write new business, retain renewals, and keep complaint files." As an analyst I wondered why “understanding technical risk” was not among the priorities. The answer is that efficiency is a crucial consideration - “for underwriter actions, we always count how many clicks a new task adds.” Today I want to convince you that you can understand at least five critical factors in cyber risk in just eight clicks and five minutes.
One Click Gives You a Distinct Perspective on Risk
Guidewire Cyence, a powerful cyber risk modeling and analytics solution, gets insurers the answers they need for better underwriting in just a few clicks. In just one click, the Cyence solution gives you at least three distinct perspectives on risk including:
Exposure Signals, a list of the top cyber vulnerabilities associated with the company being evaluated.
Probability of incident, which leverages rich exposure data and the broadest possible incident set available.
Expected losses provide the projected losses by all event sets, frequency, and severity.
These easy-to-read data elements come with benchmarks that convert technical metrics into peer comparison percentiles to help underwriters better understand relative risk. So, within one screen of data, an underwriter has a high-level understanding of the applicant's risk.
A Second Click Provides Insight on Exposure Signals
Next an underwriter can pivot their research into the technical findings to see what insights Cyence has identified and how they compare to the information collected during underwriting. This information includes:
Exposure Signal Report Card: This shows how our dozens of exposure signals compare to peers and where the real outliers reside.
Dynamic prioritization: These exposure signals are dynamically prioritized by their univariate predictive power to historical incidents at the industry, revenue, and geography sub-segment level, and favorites can be pinned.
Each Exposure Signal in this section clearly explains what it is, why it matters, how it relates to common security frameworks like NIST, and provides technical information such as the specific IP address of the identified issue. The application also shows peer distribution, historical data, and information on all referenced software and service providers. While it's a lot of information to digest, the solution is able to display and contextualize it in a manner that makes it quick and easy to understand – which allows the underwriter to focus on key items quickly.
Click Three and Four to Understand Modeled Losses
Now the underwriter wants to better understand the modeled losses for this company and its peer set. That can be achieved in one click and less than a minute, looking at the exceedance probability (EP) curve and its peer group.
With a few clicks, an underwriter adds various quote options and gets modeled outputs to see the probability of paying a loss and the expected loss for each. An underwriter could compare different retentions, sub-limits, or attachment points and look at modeled outputs against internal rating models.
With practice an underwriter can scan the third-party data and models as outlined above in five minutes, thereby understanding how weak or strong the account looks with greater confidence and efficiency.
A Comprehensive View on Cyber Risk
With cyber risk modeling and analytics, insurers significantly improve the efficiency and accuracy of underwriting cyber insurance. Underwriting management no longer needs to fear analysis paralysis or the challenge of integrating third-party data and modeling into workflows. With just a few clicks, underwriters have a distinct perspective on risk, understand technical findings and modeled loss, and make better decisions faster.
By leveraging Guidewire Cyence, underwriters focus on their core responsibilities, such as retaining business, writing profitable new business, and maintaining compliant files. Additionally, by embracing these technological advancements, underwriters stay ahead in a rapidly evolving and increasingly complex cyber landscape. If you're attending the NetDiligence Cyber Risk Summit Philadelphia 2023 this week, I'll be at booth #28 with some of my Cyence colleagues and would be happy to tell you more about these five cyber risks and how Guidewire Cyence can help you stay ahead of them.