Cyber insurance is here to stay by more exposure is needed with many areas still at risk, Coalition CEO Joshua Motta told FinTech Global.
Online security insurance provider Coalition has collected $10m in its Series A round to help support the sector by offering a broad range of policies protecting businesses. Contributions to the round came from investors including Vy Capital, Ribbit Capital, Valor Equity Partners, Y Combinator president Sam Altman, and Softbank Vision Fund senior managing director Deep Nishar.
He said, “For one, I believe that cyber insurance, as a standalone product, is here to stay. We need to insure cyber, or technological risk, as its own form of peril. Consequently, the market must also evolve to cover more of the exposure. Most cyber insurance policies today simply do not cover many of the real-world risk exposures companies face as they embrace technology (and all of its consequences).”
Coalition offers cyber insurance products which are supported by global insurers Swiss Re Corporate Solutions and Argo Group. The company provides both insurance and cybersecurity products to SMBs, helping to protect a company from risk and loss.
Coverage can be taken out for both 1st and 3rd party work; included with all policies are protection for worldwide seffort, cyber terrorism, IoT solutions and social media. Other products include funds transfer fraud, business interruption, ransomware, network breaches, system failure, and digital asset restoration, among others.
SMBs face a huge risk from cybercrime and they are not prepared for attacks, whether its is system failures, hacking, human error. Motta said, “Our platform addresses these risk management gaps for SMBs to help them prevent losses and remain resilient should the worse come to pass. We offer the most comprehensive, completely configurable coverage for SMBs because we get an up-close view of their risk exposures in our underwriting process, which allows us to address them.”
Clients also receive free cybersecurity solutions to help prevent any attacks, helping to monitor any customer’s breached passwords, ransomware protection, software patching, DDoS mitigation, threat monitoring and ethical hacking to find issues.
This equity injection will be used to support the growth the company’s engineering team, and expanding its risk management platform.
The company’s next plans are to increase the number of companies it insures, develop its security platform with more free tools for all policyholders and use data to build better insurance products, he added.
Coalition CEO and co-founder Joshua Motta said, “Solving cyber risk doesn’t mean solving security failures. It means allowing companies to embrace technology while remaining resilient to the risks that accompany it. We provide companies with free cybersecurity to prevent loss before it occurs, and expert response and comprehensive insurance coverage when all else fails.”
Cyber insurance is an area companies are taking a growing interest in, but there are still a few areas which remain untouched across the entire insurance space. This leads to more opportunities for innovation and investments.
He added, “Insurance, at its core, is about the flow of money and data. Money to pay premiums and pay claims. Data to price risk and analySe claims. Whoever can use technology to more accurately underwrite and price risk, to identify and convert clients more effectively, to deliver a superior claims and customer experience, wins.”
The biggest challenge Coalition is noticing is the education within the insurance space. There are growing levels of risk with digitisation and companies are still trying to understand them or even realise there are issues.
“Coverages and policy forms are evolving rapidly alongside the exposure. It’s a challenge for brokers to keep pace with the change, to understand the exposure and, more importantly, the coverage. Selling cyber insurance has become eerily similar to selling cyber security products: lots of marketing jargon alongside a healthy dose of fear, uncertainty, and doubt.”
Last week, Vectra, which uses AI technology to detect cyberattacks and mobilise security measures, closed a $36m funding round led by Atlantic Bridge.
