The insurance industry must address the issue of so-called "silent" cyberrisk before Scor SE will grow its appetite for cyberrisk meaningfully, according to Scor Global P&C CEO Jean-Paul Conoscente.
Speaking to analysts at Scor's investor day, Conoscente said the insurer currently writes a €50 million cyber portfolio, split almost evenly between specialty insurance and reinsurance.
On the reinsurance side, the company tends to be "very cautious" on cyber treaty business; it is focused on key clients where the relationships extend beyond standalone cyber treaties. The caution, Conoscente added, is due to silent, or nonaffirmative cyberrisk, which arises from policies that neither explicitly include nor exclude cyber coverage, potentially exposing insurers and reinsurers to risks for which they had not previously accounted.
Conoscente described recent efforts in the primary insurance industry to tackle silent cyberrisk, such as Lloyd's of London ordering its syndicates to clarify whether policies cover cyberrisk, as "very encouraging." If insurers across the board are able to do the same, Scor will "probably be more bold" and grow its cyber business, he said.
"Right now affirmative cyber is on one hand developing, but we still have to address the silent cyber before we can really expand this line of business," Conoscente added.
Scor is working on changing how it approaches cyber underwriting. On the specialty insurance side, cyber is currently written partly by the Scor Business Solutions commercial insurance division and partly by Scor's Lloyd's operation, Lloyd's Syndicate - 2015 (Channel Managing Agency Ltd.). Conoscente said Scor is building a single specialty insurance team, led by the Channel Syndicate team, to write cyber insurance.
He also said the company is looking to supplement its proprietary cyberrisk modelling tools with commercially available tools.
"Overall, the industry is maturing in its view of risk assessment of cyber and we are probably one of the leaders in this field right now," said Conoscente.
