Firms urged to take out cyber insurance

DATA- DEPENDENT companies such as banks and outsourcing - curity systems and processes given rising threats, multinational insurer American International Group Inc. (AIG) said.

“Industries and companies that are highly reliant on server network connections and handle sensitive customer data on a daily basis should consider taking out a cyber insurance policy,” said Mark Lwin, AIG Philippines Insurance and AIG Shared Services president and CEO, in a statement on Tuesday.

“As cyberattacks increase in frequency and severity, it’s not a matter of if a breach in the company’s operations will occur but when,” he added.

“Cyber insurance is a risk transfer option which needs to be part of the overall risk management strategy for any company using digital platforms or han- dling large amounts of personal data. In reality, that means just about every country interacting with customers in the 21st century.”

AIG cited a security report from Marsh & McLennan Companies, which said that Asia’s cyberspace was more vulnerable to threats compared to the West.

It said that Philippines Insurance Commissioner Dennis Fuena recognized the threat and had asked non-life insurance policy that would mitigate financial losses from cyber breaches.

AIG launched a cyber insurance policy called CyberEdge in 2013. Coverage includes regulatory costs and even bodily injury and property damage arising from cyberattacks.

“Before introducing CyberEdge to the Philippine market, our clients asked us to provide only a small coverage for their liability on the data that was in their custody and control,” said Leilani Isidro, AIG Philippines head of

“Because there was no law which mandated companies to implement certain data protec for them to imagine that they could be held accountable if their data was misused or even stolen through a cyberattack,” she added.

“The law now even prescribes fines, penalties, and jail time when owners fail to protect their data.”

AIG said the implementation of the Philippine Data Privacy law “makes Filipino companies more accountable in handling sensitive customer data and further underscores the relevance of cyber insurance coverage for Filipino businesses.”