10/24/2023 – 13:06
Swiss Re Corporate Solutions and Bradesco Seguros will enter the cyber risk insurance market for companies, through a vein that they consider unexplored: small and medium-sized businesses. This insurance sector is still small compared to the size of the market, but it is growing 25% this year due to greater interest and increased supply.
The product is the first developed by the company between Swiss Re Corporate and Bradesco, which has existed since 2017 and operates in the large risk market, in segments such as agriculture, guarantee insurance and property. The focus on small and medium-sized companies was chosen both due to the lack of products focused on the segment and Bradesco’s presence in this audience.
The president of Bradesco Auto/RE, Ney Ferraz Dias, states that the new insurance presupposes a more frequent relationship between the insurer, the broker and the client. In addition to the initial assessment of the risks to which the contracting company is subject, there are quarterly risk assessments. Another difference is that the product offers support for managing crises.
“A large company has people dedicated to this, systems, suppliers, so if fraud or something happens, it can react quickly,” he says. “Small and medium-sized companies often cannot afford to have a team like this at their disposal.”
The head of Swiss Re Corporate in Latin America, Angelo Colombo, states that the company has accredited partners to carry out the initial assessment remotely, via the internet, in the systems of companies seeking insurance. According to him, more than 2,000 variables are tested in ten minutes, generating a score that determines, among other points, the price.
“The challenge was that contracting was quite simplified, but deep enough to have fair pricing,” he says. The insurance has an average monthly value between R$2,000 and R$3,000, and covers amounts between R$1 million and R$2.5 million. It also offers coverage for lost profits and civil liability, linked to possible legal consequences for third-party data leaks.
From January to August, cyber insurance raised R$138 million in the country, according to the Private Insurance Superintendency (Susep). This is a growth of 25.3% compared to the same period last year, but the market is small: only 11 insurers have issued policies. AIG was the leader, with R$59.9 million raised.
Keeping an eye on the network
The new product is another step in joint venture to explore the potential of Bradesco’s base. Ferraz Dias states that, for the bank, insurance reinforces the relationship and also the credit profile of companies, which may lose revenue due to attacks. “Insurance strengthens Bradesco as a solution for these companies. This market does not yet exist in Brazil.”
Colombo, from Swiss, states that society is focusing on other lines of insurance, such as agricultural insurance, in search of new products. “We recently had a tour of the Central-West, talking to customers, brokers, to understand their needs, which go far beyond crop insurance,” he says.
In cyber insurance for SMEs, brokers will have a different role: that of consultant, which the insurance sector and Bradesco itself believe will become increasingly important. As cyber insurance is relatively little known in the country, Swiss Re Corporate is providing training with the network so that brokers can test it before offering it to clients.
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