How do I discuss tail risk with my clients for credible reinsurance program structuring?
Cyber risk is a dynamic, man-made peril that is evolving rapidly. The motivations of cyber attackers, their methods and the technological vulnerabilities they exploit are constantly in flux. Developing a robust, defensible view of risk in your client’s portfolio and identifying the cyber events that could bring tail risk to their books is difficult.
The forward-looking nature of cyber risk – with too few precedents to systemic cyber-attacks to reliably use past experience to predict future events – creates increased uncertainty for reinsurance buyers and portfolio managers trying to identify portfolio exposure accumulations and develop impactful reinsurance programs.
For brokers to advise their clients on how their portfolio exposures look for extreme events and how that might inform reinsurance advisory, they need a tool that offers flexibility to vary frequency, severity, and other assumptions to dynamically stress test model outputs.
CyberCube’s Portfolio Manager enables stress-testing by varying frequency distributions, frequency mode and severity modes. Scenario specific analytics also include conditional loss distributions allowing users to see the total range as well as interquartile results per scenario. Portfolio Manager allows you to drill down and identify loss drivers and areas of accumulation risk across multiple lines of business.Request more information