Story by Bill Haber / July 29, 2022
A recent survey found that 82% of global insurers expect rises in cyber premiums to continue for 2 years, due to their inability to accurately understand a customer’s security posture. 87% of insurers “want a consistent approach to analyzing cyber risk, and 89% want direct access to customer security metrics and measures proving the status of security controls.”
Ask any agency owner what their No. 1 KPI is, and they will say persistency of agency accounts.
Striving for a 95% persistency rate for commercial accounts is a key agency metric. Of course, there are retention factors that can be outside an agent’s control ― such as a merger or acquisition, or the firm ceases operations due to business conditions.
Still there is much within an agent’s control. And what’s the most important role that’s within an agent’s control? In a word,consultant. The agency world can often get caught up in account renewal X-dates and quoting yet lose sight of what clients most need:an advisor who invests the time in listening and learning about their business needs.
So, what’s on the minds of the C-Suite and business owners these days? Cyberthreats and the state of their company’s cyber-readiness.
The disruption and financial impact that a cyber-related incident poses for a business is potentially catastrophic. Insurance agents need to be proactive about educating their clients about enterprise cyber-risk and how to forestall or mitigate a breach. While agents may feel that this type of discussion strays from their core expertise, an easy starting point is to ask a client whether employees properly protect their passwords and access to company data. A cyber-assessment will identify those vulnerabilities and then should provide simple, low cost ways to protect the business.
Another risk reduction measure is to explore with clients how they monitor employees’ adherence to protocols for backing up data to the cloud. How does an organization ensure that employees are embracing appropriate cyber-related behavior? Training. Yes, the fastest way to convert workforce liabilities into allied assets that constitute a human firewall is through relevant and easy-to-understand training. And developing those training tools is an essential responsibility of your cybersecurity partner.
Many clients, especially small and medium-sized businesses, may have a misperception that a cyber-risk assessment can be disruptive and expensive. That is where the agent can provide value by reassuring the client that it does not have to be the case. The key is to select a firm that is efficient in its delivery of services and has a proven track record of working with clients of their size.
TEKRiSQ was founded to meet the needs of small and medium-sized businesses. Our straightforward data collection approach for cyber-risk assessments takes as little as 30 minutes. For ease of implementation, the findings are presented via a one-on-one video call. Explanations eschew technical jargon. Afterward, our platform can gauge how well employees are adopting the recommendations.
As a company’s risk advisor, you can point out, as additional information, that cyber-prevention steps can result in premium savings or better coverage terms. Proactive ways to “flip the script” on submissions should be understood to obtain optimal coverage for your insureds.
The client relationship is solidified when an agent is viewed as a consultant rather a salesperson, especially when it comes to cyber-protection.
We welcome the opportunity to be of service to you and your clients.
Bill Haber is co-founder, business strategy, with TEKRiSQ. He can be reached bh@tekrisq.com.
