In a still-competitive cyber insurance market, insurers are willing to take on smart city risks, observers say.
“We are open to looking at any city or county customer,” said Diane Barr, St. Paul, Minnesota-based global practice leader for public sector services at Travelers Cos. Inc. “Smart technology’s not something we shy away from.”
Many of the cyber exposures that smart cities are experiencing are already present in the private sector, so the technology has been proven, said Lisa Marsalis, San Antonio, Texas-based senior underwriting manager with OneBeacon Insurance Group’s government risk group.
“Insurers are seeing it as an improved underwriting risk,” she said.
“As long as the carriers and their insureds and the local governments and service providers work together,” coverage is available, said Thom Rickert, Dallas-based vice president and head of marketing at Trident Public Risk Solutions, which is part of the Argo Group
Other industry sectors with infrastructure-related budgetary constraints, such as health care, have also faced this issue, said Jeff Norton, Chicago-based senior vice president of technology and cyber for Brit Global Specialty USA, a unit of Brit Ltd. Now, it’s smart cities’ “turn to go through the education, if you will,” Mr. Norton said.
Damian Caraccioli, Columbia, Maryland-based vice president of CBIZ Insurance Services Inc., said he has “not seen any pushback in the market,” in terms of pricing, “just by virtue of them becoming a smart city.”
“There’s still a tremendous amount of capacity in the cyber market and carriers, I think, are very much in front of these types of exposures, so I don’t think we’re going to see risk to capacity in the near or short term” unless there are catastrophic losses, he said.
Ronni Rausch, senior vice president with Arthur J. Gallagher & Co. in Boston, said smart cities “with severe risk concerns are going to have higher retentions and higher premiums, but the market has been
pretty steady.”
