Page 22 - AASBO The EDGE Summer 2022

SPRING CONFERENCE WRAP-UP

BY DON HARRIS
Marijon Anderson Albert Magallanez
What Cyber Insurers Expect as Cyber Attacks Rise

As cyber insurers try to keep pace with cybercrime, There are three key reasons why cybercrime
school districts are being hit with rising costs. poses unusual challenges for insurers. Cyber is
different because risk exposure is constantly
AASBO members were asked by three presenters changing, there is a lack of historical trending for
at the Spring Conference to remember the good underwriting, and it requires a change in thought
old days – when cyber insurance was included processes and risk behaviors.
by The Trust at no extra charge to members and
higher limits were not difficult to obtain. Cyber insurance trends can affect school districts
in several ways. Security controls currently
The presenters — Marijon Anderson, Risk required include, air-gap backup, regular
Management Analyst, Arizona School Risk phishing, and training campaigns, privileged and
Retention Trust; Calvin Clarke, Security Analyst, remote user multi-factor authentication.
Arizona School Risk Retention Trust; and Albert
Magallanez, Director of Technology Services, AASBO members were provided with some
Continental Elementary School District — then startling statistics to emphasize how critical
told their audience to fast forward a few years cybercrime is. For example, successful cyber-
when cyber incidents and ransomware have attacks occur every 11 seconds, more than half of
become an endemic. They want AASBO members, all organizations were impacted by ransomware in
especially IT managers, business managers, risk the past year, and ransomware costs in 2021 were
managers and emergency managers, to know $20 billion. If that’s not enough, the likelihood
what cyber insurers expect today. of detecting and prosecuting the perpetrators of
cyberattacks in the U.S. is at a dismal 0.05%.
The trends in cyber insurance may be shocking to
anyone who is paying the bills. Cyber is the most To combat this 21st century menace, The Trust has
volatile and fastest changing line of insurance expanded its Cyber Outreach Program to assist
from a standpoint of premium, structure, members. In addition, The Trust has introduced
wording, and claims. To combat that, cyber pre-conditions of coverage for the 2022-2023
insurers are implementing significant pricing and year. It was explained that the benefit of being in
underwriting actions. a pool is that The Trust is working closely with its
reinsurers to get the most favorable coverage and
A word of caution: Most carriers are reducing rates for its members without the severe impact of
capacity and limits, “cherry- picking” clients, and the current insurance market.
some are non-renewing members, leaving them
with no options. The Trust provides cyber risk assessment. It is the

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22 THE EDGE SUMMER 2022