Product News

January 25, 2016
Hiscox Expands Terrorism Coverage

Hiscox, an international specialist insurer, announced that they have enhanced their stand-alone Terrorism portfolio adding new products covering property damage due to malicious attacks utilizing nuclear, chemical, biological and radiological (NCBR) devices.

Hiscox NCBR policies offer coverage of up to $25 million for blast damage, decontamination and clean-up costs, as well as lost income due to related government actions. Hiscox also recently introduced coverage for Threat of a Malicious Act. The new Threat product protects businesses against threats of malicious acts that can result in costly disruptions to businesses and lost sales revenues.

Hiscox policyholders also receive access to Control Risks risk advisory services both before and after incidents to reduce their total risk. Control Risks global risk consultancy partners exclusively with Hiscox to offer their clients specialized advice on how to prepare, prevent and mitigate malicious acts through direct consultation and a 24/7 helpline.

Hiscox provides coverage for Terrorism, NCBR and other politically violent activities without a requirement for government certification of a terrorist attack and no minimum loss requirements. The capacity stands independent of the US government-backed Terrorism Risk Insurance Reauthorization Act (TRIPRA).

AIG Boosts Global Commercial Property Limits to $2.5 Billion

American International Group, Inc. announced that it has significantly raised available global commercial property limits to $2.5 billion per occurrence.

The move responds to the growing demand for capacity and services by clients managing more complex global risks and increasing property values. It also reflects AIG’s greater appetite for property risk based on its ongoing expansion of risk engineering and data analytics capabilities.

Today’s announced limits build on AIG’s capacity of $1.5 billion per occurrence available globally to clients since 2012.

RMS Launches New Data Standard for Managing Cyber Insurance

Ahead of the February launch of its new suite of cyber risk management tools, RMS has released its recently developed Cyber Exposure Data Schema. The ‘open standard’ data schema will provide the insurance industry with a systematic and uniform way to capture cyber exposure data and manage cyber accumulation risk.

The Cyber Exposure Data Schema, developed in collaboration with the Centre for Risk Studies at Cambridge University and with support from eight leading insurance and reinsurance companies, provides firms with a standardized approach to identifying, quantifying and reporting cyber insurance exposure. The schema is both model agnostic and compatible with any exposure management system and will enable firms to:

  • Share and transfer information about exposures in a consistent and standardized format for risk transfer transactions, benchmarking exercises, and regulatory reporting.
  • Report exposure aggregates by different types of coverage and potential loss characteristics to a level of granularity that can inform risk appetite decisions.
  • Assess and monitor risk appetite by estimating losses from accumulation scenarios, or other types of risk models, to the exposure recorded.
  • Clarify silent or affirmative covers by identifying insurance policies with ambiguity in whether they would pay out in the event of a cyber incident

To develop the Cyber Exposure Data Schema, the Cambridge Centre for Risk Studies consulted with a broad range of organizations seeking to harmonize cyber exposure reporting, including cyber risk experts, cyber insurance writers, and industry organizations such as the Lloyd’s Market Association, U.S. rating agencies, the Reinsurance Association of America, and the Chief Risk Officers Forum.

In addition to making its Cyber Exposure Data Schema available to all industry participants, RMS has also collaborated with Lloyd’s of London and AIR Worldwide to help the growing cyber insurance market quickly establish the core data requirements for managing cyber risk common to both modeling firms. By using similar terminology and precise definitions, in addition to highlighting the common elements across their data schemas, the initiative will make it easier for companies to code existing account data to identify their potential cyber accumulations.

AXIS Healthcare Launches New Coverage to Protect Hospitals Against Losses From Pandemics

AXIS Capital Holdings Limited announced that AXIS Healthcare—the division of AXIS Insurance that provides professional liability insurance and associated standard casualty coverages for physician groups, hospitals, allied healthcare facilities and individual physicians—has launched an innovative new medical catastrophe business interruption product for hospitals in the U.S. and Canada to protect against a loss of revenue caused by the outbreak of a contagious disease.

The AXIS Healthcare Medical Catastrophe Business Interruption and Extra Expense product includes coverage for any disease that is transmitted by direct or indirect contact. These diseases include bubonic plague, MRSA, Legionnaires’ Disease, Middle East Respiratory Syndrome (“MERS”), Hantavirus, SARS, West Nile Virus, HIV, Ebola Virus, Marburg Virus, Lassa Fever, Influenza, and Bird Flu, as well as other lesser-known viruses or plagues. The new product would also provide coverage for diseases that have not yet been discovered by science, or a disease that could mutate into a pandemic at some point in the future.

The policy responds when the contagion directly results in any one of four triggers:

  • A governmental quarantine of a hospital;
  • If 25 percent or more of the medical personnel do not come to work;
  • A 25 percent or more reduction in inpatient stays; or
  • A 25 percent or more reduction in emergency room visits.

The maximum length of coverage is limited to twelve months from the date the coverage is triggered.

Prior to offering a quotation, a hospital must work with AXIS Healthcare on a pandemic preparedness assessment. The company will send, at its own expense, a healthcare risk manager with specialized skills in pandemic preparedness to assess the quality of the hospital’s pandemic program.

Verisk Releases Industry’s First Cyber Exposure Data Standard

Verisk Analytics, a data analytics provider, announced that it has released the industry’s first global cyber exposure data standard. This standard will help create a uniform method for data transfer across the insurance value chain. Verisk’s catastrophe modeling business AIR Worldwide has also developed a preparer’s guide to assist companies in collecting and storing the necessary cyber exposure data in an open format suitable for modeling.

The Verisk cyber exposure data standard is the first step in the process of managing accumulations of cyber risk and will help create a uniform method for data transfer throughout the industry. Many of the fields are optional to provide flexibility for companies that collect different types of information or at different levels of detail. The AIR preparer’s guide will assist companies in collecting and storing the data. Many client organizations, including companies in the insurance, broker, and reinsurance industry, have reviewed the standard and provided valuable input.

Cyber risk has become the fastest-growing peril over the past year. The ability to analyze cyber risk accurately requires a full understanding of the cyber exposure data. It is imperative that companies capture this data in a common format that can be used by organizations across the insurance value chain. It is also crucial that the exposure data standard used today and in the future be robust enough for organizations to grow into.

In addition, AIR has developed an SQL implementation to allow organizations to begin to use the standard in their enterprises. In the coming months, AIR aims to provide SQL scripts that can be used for deterministic scenario analysis and accumulation analysis.

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