Tech Talk: Insurtech Competition and New Cyber Security Threats Pose Increased Challenges
First, those in the industry who dismissed the rise of the so-called insurtechs are taking a fresh look at these technology competitors.
Second, agents and carriers are addressing cyber security with a new sense of urgency and a realization of the multiple threats the issue poses.
Last year, when Google announced its intention to bring its Google Compare auto insurance comparison shopping site to the U.S., some sounded an alarm but others said the threat was overblown. When Google shuttered the venture, the skeptics felt vindicated. Since then however, dozens of new ventures have already launched or are preparing to do so. Many will fail but more than a few will likely catch fire and provide competition to independent agents, primarily but not limited to personal lines coverages.
These include on-demand insurance platforms such as Trov, Slice, SafeShareGlobal and Lemonade, the last of which is also a licensed insurer. Time will tell as to their ultimate success. At the same time, their appeal to buyers in enabling simple coverages via a smartphone is unmistakable. Agents who fail to respond by providing 24/7 service and at least some services through a smartphone may lose forever a chance at a large swath of younger insurance buyers.
Many agents are still taking a wait-and-see attitude. It was encouraging, however, to see agents keep an eye on the rearview mirror while also stepping up efforts to upgrade their digital capabilities.
A more immediate challenge for agents is on the cyber security front, including data breaches and cloud security. Both meetings featured presentations on various aspects of the security problem — not just on cyber security threats but also how to mitigate them.
Ryan Spelman, senior director at the Center for Internet Security (www.cisecurity.org/cyber-pledge) discussed the urgent need for agents to take greater control over their “cyber hygiene” to reduce the likelihood of cyber attacks.
Spelman dispelled the myth that agents are not vulnerable because of their relatively small size.
“Cyber criminals are part of a $300 billion global business,” he said. “They look for the easier targets and size is not a barrier. Breaches at small community banks and doctors’ offices are all too frequent.”
Spelman asked agents to imagine the consequences of lost trust from their clients if their business was hacked.
Spelman cautioned that no prevention protocol is 100 percent effective but recommended five simple steps agents can take to be as secure as possible.
1.
Count: It is critical to know what’s connected to your network. Create an inventory of every piece of equipment that’s connected, including computers, smartphones, routers, scanners and building systems. Simply put, you can’t protect what you don’t know exists.
2. Configure: Protect systems by implementing key security settings and using unique, strong passwords and changing them periodically.
3. Control: Manage accounts and limit user and administrator privileges to change, bypass or override security settings.
4. Patch: Patch and vulnerability management is a security practice designed to proactively prevent the exploitation of IT vulnerabilities that exist within an organization.
5. Repeat: Stay current.
Spelman also underscored the need to have a clear written security policy and continual security awareness training for employees.
Longtime insurance communicator Wetzel heads his own insurance marketing firm that specializes in website design and social media programs for agents through its Social Media Content Roadmap©. Website: www.wetzelandassociates.com. Email: twetzel@wetzelandassociates.com. Phone: 708-771-1533.