The transaction bolsters Swiss Re’s resilience with US$50 million in coverage against catastrophic US cyber insurance events. The cyber Retro ILW was brokered by Gallagher Re and supported by a number of specialist reinsurers.
The announcement about Swiss Re acquiring the inaugural Retro Industry Loss Warranty (ILW) in the cyber market comes after the prosperous introduction of the PoleStar Re underwritten-rule 144A cyber catastrophe bond in December. Facilitated by Gallagher Securities, the transaction received guidance from the Gallagher Re Cyber team, leading to an impressive 87% increase in marketing to reach a total of US$140 million.
According to reports, the acquired coverage extends beyond conventional risks, encompassing protection against prevalent threats such as malicious ransomware or malware, protracted catastrophic cloud outages, and systemic data breaches. The ILW marks a significant milestone in the cyber insurance landscape, reflecting Swiss Re’s commitment to diversifying its risk management strategies.
Nick Meuli, Head of Property and Casualty Capacity Management at Swiss Re, expressed the company’s strategic focus on tapping into external sources of cyber capacity to augment its inwards cyber business. He stated, “Accessing alternative external sources of cyber capacity to support our inwards cyber business has been a key priority for us. We are very pleased to have secured significant ILW protection which provides yet another novel and complementary cover for our cyber portfolio.”
Commenting on the acquisition, Ian Newman, Global Head of Cyber at Gallagher Re, said that its launch reflects a market which is growing in confidence, a cyber cat bond market that continues to develop at pace, with more growth expected in the months and years to come“Alongside traditional retro and cat bond solutions, we believe ILWs and parametric solutions will form a critical part of the cyber value chain in the coming years. We are proud to have delivered another market first on behalf of Swiss Re, a true market leader in this space.”
Theo Norris, Head of Cyber ILS at Gallagher Re, added: “Successfully executing this innovative solution for Swiss Re is another step forward in broadening the potential access for capital to enter the Cyber insurance space and to provide effective, alternative solutions for insurers and reinsurers alike.”
