POLICY - May 2019

POL I CY The Israeli Insurance , Pension&FinanceNewspaper 6 Tel Aviv Re 2019 “The main trend characterizing the insurance and reinsurance sector in the past year is the attempts by the insurers and the reinsurers to find solutions for cyber insurance. Demand is growing continuously and the insurance world is still trying to find solutions”. Harel Insurance and Finance Group President, Gideon Hamburger , who is the founder of the TelAviv Re reinsurers conference, made these remarks in a conversation with Policy running up to the forthcoming Conference, being held this year for the 13 th time. The Conference is unique, since unlike other reinsurance conferences, such Baden Baden and Monte Carlo, the Tel Aviv Re Conference is characterized by reinsurers from all over the world coming to meet representatives only from the Israeli insurance sector. According to Hamburger, “There is growing interest in the Conference, and the reason for this is that the Israeli economy is very strong. Another reason for the strength of the Israeli insurance sector is that the companies and organizations in Israel have the economic means and high awareness of the importance of purchasing insurance. Hamburger added: “There is lately a lot of interest on the part of reinsurers from around the world in Israeli companies providing cyber protection. They are likewise interested in start-ups in various areas”. • What characterizes the growth in the cyber field? Hamburger: The main challenge is to find a cyber insurance solution for large organizations and corporations. Since smaller entities have no problem in finding insurance coverage. For example, the damage caused if a hacker succeeds in penetrating the computer systems of large medical institutions and hospitals and destroys the medical records would be enormous. An interesting aspect is that the ones demanding that the companies purchase cyber insurance are the boards of directors, whereas the IT managers are convinced that their protections systems are strong enough. For the reinsurers, Israel is an interesting destination, amongst other things because of the development in recent years of many companies in the hi-tech sector and in the area of cyber protection. • What other trends are there in the sector? Hamburger: Difficulties have been experienced internationally in the past year in purchasing reinsurance for contractors policies. The main reason for this is the poor results that have characterized the sector recently, and also the heavy competition that has affected the sector. Because of the types of construction in recent years, with the building of very large towers and buildings, as well as giant national infrastructure projects – there is demand for contractors insurances in very large amounts. There are a few projects of a billion shekels and more. Inaddition thereare safetyproblems at construction sites. Construction worker fatalities are frequent, and since contractors insurance includes also employers liability insurance this has a negative impact on the underwriting results. • Are similar problems being experienced in other sectors? Hamburger: Yes. The marine insurance sector is also experiencing similar problems, particularly in coverages for hail damage. The changes in the weather and the phenomenon of hail in various places, result in severe damages, since, for example, storage at ports is not under cover, and is thus exposed to the forces of nature, with heavy damages occurring to property stored in the open. For example, vehicles waiting in huge parking areas are exposed to weather damages. • Is this something which is peculiar to Israel? THE INSURERS AND REINSURERS ARE WORKING TO FIND A SOLUTION FOR THE GROWING DEMAND FOR CYBER INSURANCE Pol icy conversation with Harel President and founder of Tel Aviv Re Gideon Hamburger OLICY Harel President Gideon Hamburger Continued on page 33