Cyber MGAs Resilience and Corvus prepare for growth in cyber risk

Two US managing general agents – Resilience and Corvus – have separately announced targeted growth in cyber insurance as demand surges, prices harden and capacity becomes harder to get for individual buyers. Resilience has raised $80m from an investment funding round, which will be used to expand cyber insurance for middle-market buyers in the US but also internationally. Resilience said a spike in ransomware claims during the past year and hard cyber rates have “enabled newcomers with an innovative approach to rise to the top”. Corvus Insurance said it too wanted to grow its commercial insurance business, which includes cyber, in the “current attractive conditions” and build on corporate investment since its launch as an insurtech in 2017. Corvus has partnered with CyberCube to use its models to better understand risk accumulation within its cyber and data breach books. Corvus, which uses AI-driven risk data in its own tools, said CyberCube’s portfolio manager, single point of failure and attritional loss models would allow it to stress-test portfolios against systemic cyber-related scenarios and integrate CyberCube’s risk aggregation analytics into its own tools, to analyse its exposure to cyber risk. Lori Bailey, Corvus Insurance’s chief insurance officer, said: “We believe CyberCube’s technology coupled with Corvus’s proprietary risk aggregation platform will provide greater transparency of cyber risk aggregation to our risk capital providers.” Buyers have seen cyber rates rise incrementally last year and into this year, with Q2 2021 recording a 26% increase according to S&P, and with analysts predicting even harder rates during the next two years. However, some insurers have stepped back from cyber underwriting or tightened terms and conditions, given the increase in ransomware attacks and claims costs. Earlier this month, Fitch said the aggregate loss ratio for US standalone cyber insurers hit 73% in 2020, up from 47% in 2019, despite a 30% increase in direct written premiums. Resilience said its Series-C funding round was led by General Catalyst and Corey Thomas, and attracted support from venture capital businesses including Lightspeed Venture Partners, Founders Fund, Charles River Ventures, Shield Capital and Intact Ventures. Reliance said much of its growth is targeted at the middle market in the US. “We took a deliberate approach in entering the middle market. Our clients are discerning buyers with sophisticated infrastructure. We proactively connect their security posture with their insurance policy, not as vendors, but as partners. That personal, integrated approach of transparency and action is what makes us so different,” said Vishaal Hariprasad, CEO of Resilience. “This funding round signals that the market is ready for our ‘insure + secure’ model,” Hariprasad said, which provides tailored insurance and security solutions to buyers and uses in-house security engineers to work with clients to build cyber resilience.

Cyber MGAs Resilience and Corvus prepare for growth in cyber risk

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