In a bid to strengthen its efforts to protect businesses from cyber threats, Coalition, the world’s first Active Insurance provider, has announced the creation of its reinsurance intermediary, Coalition Re. This new initiative will provide capacity for cyber reinsurance treaties, offering crucial support to businesses vulnerable to cyberattacks. Coalition Re will allow companies to safeguard themselves from the growing digital risks that have increasingly disrupted global markets.
The launch of Coalition Re comes at a critical time when cybercrime is on the rise, affecting organisations of all sizes. Its introduction aims to expand Coalition’s mission to shield unprotected businesses from the potentially devastating consequences of cyber incidents.
A Revolutionary Approach to Cyber Reinsurance
Coalition Re is set to offer non-proportional cyber reinsurance treaties to businesses globally. It will also provide a white-labelled cyber insurance product with up to 100% quota share support for cedants—insurers who pass on their risk to a reinsurer—who wish to offer cyber insurance as an extension to existing insurance policies. This innovative offering will be supported by a strong panel of capacity providers, led by Aspen, a leading global insurer and reinsurer.
One of the key issues Coalition Re seeks to address is the breakdown of communication and understanding between reinsurers and policyholders. According to Shawn Ram, Head of Insurance at Coalition, “In reinsurance, there is often a breakdown of information where reinsurers know less about policyholders than the primary insurers.” This lack of insight, combined with limited cyber expertise, often results in inaccurately priced reinsurance contracts and misunderstandings regarding how to assess cyber risk.
Coalition Re aims to transform the reinsurance landscape by providing reinsurers with deeper insights into the cyber risks within their portfolios. This approach, Ram said, will not only “add capacity but also deliver value far beyond traditional reinsurance practices by using advanced technology to help insurers assess cyber risk more accurately.” Coalition’s cutting-edge technology, which it uses for its Active Insurance policyholders, will now be available to reinsurers, helping them better manage cyber risks.
The Role of Active Insurance
Coalition’s Active Insurance model is a standout feature of its offerings, helping businesses before, during, and after a cyber incident occurs. Traditional insurance policies often leave companies vulnerable, offering little to no assistance with risk mitigation. Coalition Re’s approach flips this narrative by offering a holistic solution that combines real-time risk mitigation tools with comprehensive insurance coverage.
“Unlike other reinsurers, Coalition doesn’t rely on historical or third-party data,” Ram explained. “We’ve built a robust and innovative approach to cyber reinsurance underwriting, leveraging continuous, internet-wide data collection, AI-enabled threat detection, and real-world security and insurance expertise.”
This technology-first approach allows Coalition Re to create a more accurate and comprehensive picture of cyber risk, addressing a critical gap in the reinsurance market. It will also enable primary insurers to learn more about their policyholders’ cyber risk profiles and the key sources of vulnerability within their portfolios.
Partnership with Aspen
Aspen, one of the leading players in the insurance and reinsurance industry, has partnered with Coalition to bring this innovative solution to market. Bobby Bianconi, Global Head of Cyber at Aspen, expressed enthusiasm for the collaboration: “We are thrilled to partner with Coalition on this innovative reinsurance offering to bring clarity to the increasingly complex and critical risk of cyber.”
Bianconi highlighted the significance of Coalition Re’s data-driven approach to cyber risk, which will give cedants access to detailed insights into the risks faced by their policyholders. “We see a significant opportunity for this new capacity and the unique cyber risk insights that will complement the offer,” Bianconi said, adding that Coalition Re is well-positioned to deliver market-leading cyber coverage to clients around the world.
Tackling the Growing Cyber Risk Landscape
The creation of Coalition Re reflects the increasing urgency to address cyber risks on a global scale. The growing frequency of cyberattacks, coupled with the complexity of the digital landscape, has left businesses more exposed than ever before. With ransomware attacks, data breaches, and other forms of cybercrime on the rise, companies are facing substantial financial and operational risks.
Coalition Re’s introduction is a timely response to this growing threat. By offering reinsurance solutions that are backed by advanced technology and real-time data, the intermediary will enable reinsurers to more accurately price reinsurance contracts and improve their understanding of cyber risk accumulation.
Ram believes that by democratising Coalition’s technology, the company can “better align interests with cedants and promote a more stable cyber reinsurance market.” This focus on technology and data-driven decision-making could have a transformative effect on how cyber reinsurance is priced and managed, ultimately leading to a more resilient and protected business landscape.
Looking Ahead
As cyber threats continue to evolve, Coalition Re’s entry into the market signals a significant shift in how the insurance industry approaches digital risk. By leveraging advanced technology and providing reinsurers with unprecedented insight into cyber vulnerabilities, Coalition Re has the potential to create a safer, more stable reinsurance market.
Aspen’s Bobby Bianconi is confident that the partnership will lead to continued innovation in the sector: “We look forward to the continued work we will do with Coalition to bring market-leading cyber coverage to clients.”
With a growing number of businesses at risk from cyberattacks, the need for innovative and effective insurance solutions has never been greater. Through Coalition Re, the company aims to protect more businesses from the devastating impact of digital threats, ensuring they are better prepared for the challenges of the modern cyber landscape.
