Thursday, 17 May 2012
Risk transfer industry must better prepare for intangible asset losses—JLT
JLT has warned that risk managers at global communications, technology and media firms and their risk transfer partners must better understand the risks and potential losses associated with intangible assets.
Peter Hacker, Head of Communications, Technology and Media Practice at JLT
Speaking ahead of its Annual JLT Global Communications, Technology & Media (CTM) Forum in Salzburg today, the broker said that the frequency and severity of incidents affecting such assets is only set to increase.
In particular it believes that cyber crimes, including privacy breaches, with the potential for causing reputational damage, will rise.
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"Advisers, clients and insurers need to better understand and map the risk landscape and in particular the shift from protecting assets to protecting liabilities and intangible assets. We are seeing a material increase in the average frequency cost of data breaches and claims that have reached new records. Whilst disruptive technologies (eg cloud computing) will optimise the cost base, it could potentially trigger a new wave of privacy claims if clients don't comply with the relevant data directives in the respective jurisdictions. Most importantly, you can't delegate accountability in this field,” said Peter Hacker, Head of Communications, Technology and Media Practice at JLT.
JLT expects 50% to 60% of all CTM corporations to revise their corporate privacy policy, catastrophe response plans and insurance requirements by the end of 2012.
Peter Hacker continued: "Everyone is talking about cloud computing and the opportunity but as a concept it doesn't recognise international boundaries and the associated compliance and laws. As an industry we need to help clients to unlock the potential of cloud computing and other cyber applications whilst helping them to manage the risks. I'm sure next week will create some interesting debates and hopefully some sustainable solutions as well."
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