30 mayo, 2019
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Events, developments, and opportunities in the international marketplace


UK – Why Perfection is Impossible for Driverless Cars

The U.K. government intends to play a leading role in bringing the new autonomous vehicles technology to fruition, as exemplified by last year’s passing of the Automated and Electric Vehicles Act. It will also shine a spotlight on driverless cars to a degree that has not been seen before on that side of the Atlantic. What is going to be critical about these trials is their impact on public perception. In the United States, 2018’s Uber collision and resultant fatality in Arizona diminished America’s confidence in driverless technology. A survey published by U.S. automobile body AAA just two months after the crash showed that 73% of American drivers would be ‘too afraid’ to ride in a self-driving vehicle, compared to 63% in late 2017. The state of Arizona immediately halted Uber’s trials, dealing the company’s plans a catastrophic blow. Yet, in the U.S., driverless vehicles have already accumulated more than 10 million road miles, around 14 times more than the distance the average American driver travels in his or her motoring lifetime, with few incidents. Despite popular belief, driverless cars have proven themselves to be safer than their human counterparts. Why does the public overreact when there are accidents happening every day? Autonomous vehicles are perceived to be flawless and as a result their technology and results are under the public’s scrutiny. The fact of the matter is that they are not going to be flawless. However, autonomous vehicles are swathed in sensors that collect a treasure trove of information for use in collision analysis, and will prove extremely beneficial in improving technology. Just because perfection is unobtainable does not negate the tremendous safety improvements this technology will offer

GDPR – Affecting Cyber Insurance Demand

The United States is the largest market for cyber coverage and the U.S. property/casualty insurance industry’s total direct written cyber premiums grew 8% in 2018 to $2 billion. It is believed that the GDPR and its potential for significant penalties is spurring more interest in cyber risk management and coverage even though the growth rate has slowed compared with 2017. GDPR enforcement took effect in May 2018.There is no question that the GDPR has had a direct impact on the decision to purchase cyber insurance. The focus on cyber insurance is likely to expand as more jurisdictions adopt similar regimes.The European Union’s General Data Protection Regulation is starting to have an impact on the demand for cyber insurance – an impact that will likely accelerate as other jurisdictions adopt similar privacy regimes.

About a third of the largest companies in the U.K. market have purchased cyber insurance, but the take-up rate among smaller organizations is much lower even though they are arguably more reliant on the post-breach response and resources of insurers. Risk managers in industries that traditionally do not buy cyber insurance have started purchasing the product, as they begin to realize that a cyber attack is not just a data breach and theft but also business interruption and supply chain disruption

Smart Home Devices May Provide A False Sense of Security

Researchers at North Carolina State University have identified design flaws in “smart home” Internet-of-Things (IoT) devices that allow third parties to prevent devices from sharing information. The flaws can be used to prevent security systems from signaling that there has been a break-in or from uploading video of intruders.

Essentially, the devices are designed with the assumption that wireless connectivity is secure and will not be disrupted – which is not always the case.

Researchers have found that if third parties can hack a home’s router – or already know the password – they can upload network layer suppression malware to the router. The malware allows devices to upload their “heartbeat” signals, signifying that they are online and functional – but it blocks signals related to security, such as when a motion sensor is activated. These suppression attacks can be done on-site or remotely. One reason these attacks are so problematic is that the system is telling homeowners that everything is OK, regardless of what is actually happening in the home.

These network layer suppression attacks are possible because, for many IoT (Internet of Things) devices, it is easy to distinguish heartbeat signals from other signals. Addressing that design feature may point the way toward a solution. No system is going to be perfect, but given the widespread adoption of IoT devices, it is important to raise awareness among Risk Managers of countermeasures that device designers can use to reduce their exposure to attacks.

USA – Renewal of TRIPRA?

The long-term viability of the U.S. property terrorism insurance market is back in the spotlight as the United States Congress looks to renew the Terrorism Risk Insurance Program Re-authorization Act (TRIPRA), which is set to expire in Dec. 31, 2020. Alpha brokers advise that the Property terrorism insurance market remains strong with sufficient capacity to respond to today’s main terrorist threats in part due to TRIPRA as well as few claims. If for whatever reason Congress will not renew TRIPRA before it expires, there could be various market effects. Effects that may be seen but are not limited to;

  • Insurers may insert sunset clauses in renewal policies
  • Price increases or limited writing based on preferred locations
  • Some insurers will have to purchase additional private reinsurance
  • An influx of new buyers into the reinsurance market could affect pricing.
  • Reinsurers are likely to be selective in providing additional capital, which could pose a capacity problem for some businesses in high profile cities, and employers with significant workers’ compensation accumulations.


Although private terrorism reinsurance is currently available, future availability and affordability of reinsurance if the federal backstop is eliminated or changes significantly, will be a concern.


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