ORLANDO, Florida — Implementing telematics in vehicles can help construction companies monitor driver behavior, and by using the data to develop a safety culture they can better differentiate their risk profile to insurers.

Devices such as front, rear and driver-facing cameras are increasingly being deployed by construction companies as contractors look to improve safety on and off sites and to mitigate so-called nuclear verdicts in auto liability, brokers and insurers say.

“We don’t want the person not to speed because there’s a camera. We want them not to speed because it’s a safety mindset and they want to go home at night safe and the other drivers on the road to go home at night safe,” said Michael Meisten, New York-based chief broking officer at American Global LLC.

Taking the data and then using that to drive cultural and behavioral change is critical, Mr. Meisten said during a panel discussion at the International Risk Management Institute Inc. Construction Risk Conference held in Orlando last month.

Companies should apply data in a practical way, he said. “Using those telematics, maybe it’s forward-facing cameras, to dispute the claims where you’re not involved, but also if you are involved you can own it and you can attack the settlement,” he said.

“You can’t ignore the data, because if you ignore it and there’s a loss, well, then, you did nothing with the data,” said Brian J. Poliafico, vice president of Starr Insurance Cos. in New York.

Mr. Poliafico recalled an instance where a policyholder had been involved in a substantial claim, which was an auto loss where telematics technology had been installed in the car and the driver had broadsided a minivan in a remote area, he said during the panel session. The mother survived and had to watch her children die, he said.

“You go back to the telematics. The driver of this vehicle never did the speed limit, was always 15-20 miles above the speed,” he said.

It’s not just about investing in the device, it’s about the data and the management process behind it, Mr. Poliafico said. 

Distracted driving continues to be an issue and more people are driving, said James Savage, head of construction casualty at Zurich North America in Schaumburg, Illinois. 

Auto accidents are starting to influence insurers’ workers comp portfolios, and the number of fatalities from auto-related incidents has increased significantly, Mr. Savage said in an interview at the conference.

“Not only are drivers driving to work getting in accidents, but, unfortunately, accidents are occurring that take their way into job sites, and it’s something we’re concerned about,” Mr. Savage said.

Advancements in technology will help people become better drivers “when they’re on the clock, when they’re driving to and from work and going home at night, and just out in society in general,” he said.

Loss prevention is critical, said Paul Anderson, vice president of field underwriting at Crum & Forster Co. in Morristown, New Jersey. “The main thing contractors should be thinking about is not having an accident,” Mr. Anderson said in an interview.

Technology such as GPS and dash cameras provide an extra layer of vigilance, warning drivers if they are too close to the car in front, if they are speeding, making excessive lane changes or at risk of collision, said Louise Vallee, vice president, risk engineering, at Crum & Forster. 

“With employees driving alone, the human element can be so variable, depending on how employees are feeling, how tired they are, what day it is, and what’s on their mind,” Ms. Vallee said.

Investing in equipment and monitoring might cost about $1,000 per vehicle and “seems way worth it as opposed to some of these policy limit and nuclear verdicts that go to multiple millions of dollars,” she said. 

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Increasing ransomware attacks call for contractor cyber resilience 

Cyber resilience is critical for contractors, especially with the resurgence of ransomware attacks and as hackers start to exploit weaknesses in artificial intelligence, insurance experts say.

Multifactor authentication, employee cyber training and incident response plans are among the controls that contractors should put in place, they said during a session last month at the IRMI Construction Risk Conference in Orlando, Florida.

Contractors should also review their reliance on vendors, sub-contractors and third parties and use contracts as a way to mitigate cyber risks, they said.

Ransomware attacks are huge and not going away, said Tara Albin, Chicago-based director, Midwest region cyber leader, at Willis Towers Watson PLC.

“We’re starting to see an uptick again. It doesn’t help that we’ve got two wars going on in the world and sympathizers that are on both sides, with all countries involved,” Ms. Albin said.

“Not a week goes by when one of our clients does not call us and say, ‘I think we’ve got a ransomware attack,’” she said.

Back in 2017 and 2018, threat actors were demanding ransoms of about $20,000, said Michelle Chia, New York-based head of professional liability and cyber for Zurich North America.

“Ransom demands are on average in the millions right now,” Ms. Chia said. “Typically, it’s in the $5 million range, but for a large or medium org, the ransom demands get up to $70 (million) or $100 million,” she said.

Whether to pay a ransom demand is a business decision that organizations have to make, Ms. Chia said. Businesses need to consider whether they are going to be able to get a backup running and how much that is going to cost in terms of business interruption, she said.

Large companies such as MGM Resorts International and Caesars Entertainment Inc. are not the only ones getting hit by ransomware attacks, Ms. Albin said. “Small, middle-market companies with close to $400 million in revenue, privately held companies are being hit all the time.”

Having an incident response plan and making sure everybody knows what they’re doing is critical, she said. Cyber policies also give businesses access to extra services provided by insurers that can help them get through and get back up and running, she said.

AI is already being exploited by hackers for voice records so they can mimic the voice of a chief financial officer to carry out social engineering attacks such as fraudulent wire transfers, Ms. Albin said.

Publicly available AI that employees shouldn’t be using to do their particular job is being deployed by some organizations, Ms. Chia said. A recent case where an attorney used ChatGPT to write some of his briefs led to him being disbarred, she said. “That should not be done,” she said.

Having an AI policy in place that dictates when employees are permitted to use AI and what risks an organization is taking on by using generative AI is important, she said.