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HACKING

Cyber protection market takes off in Europe

It is already a booming market in the United States, but in Europe, companies are also waking up to the idea of cyber insurance to protect themselves against internet attack.

Cyber protection market takes off in Europe

And insurance companies are projecting strong growth in the coming years.

On the other side of the Atlantic, where companies are obliged to inform US authorities of online attacks, the cyber insurance market is already highly developed, totalling $1.3 billion (€960 million) per year, according to Christopher Lohmann, head of Germany and central Europe at Allianz Global Corporate and Speciality.

Europe is still a long way off that. “But we project strong growth in the coming years. We see the market amounting to 700-900 million euros by 2018,” Lohmann said.

For companies and private individuals, the dangers from the web are very real, ranging from data and identity theft to espionage.

Companies can see their infrastructure paralysed, their computer systems infected with viruses and malware.

But these are not the only risks: human error and internal hiccups can also jam systems and wipe data.

Just last month, mobile phone operator Vodafone was the victim of massive data theft where personal information — including bank account details — of around two million people was stolen.

And with the exponential growth of electronic messages, and the increasing transfer of companies’ commercial processing and data storage to cloud computing, the dangers are only going to multiply.

In Germany, a total 64,000 acts of cyber crime were officially reported in 2012, representing around 42 million euros worth of damage, an increase of 7.5 percent over the previous year.

And that is just the tip of the iceberg, experts say, because many companies prefer to remain silent over any breaches in their security systems.

“Europe is still very much behind on this,” said Nicolas Helenon, founder of the insurance broker NeoTech Assurances.

“Big companies armed themselves against these risks long ago. But most small and mid-sized companies are not insured,” Helenon said, arguing that many businesses found cyber risks more difficult to grasp than, say, fire or water damage.

“The threat of cyber crime is primarily a concern for companies who manage a lot of client data,” said Philipp Lienau at HDI Gerling.

“In case of an attack by hackers or data theft, it can be they who can be held responsible. But above all, it’s a major cost factor. Informing those affected by any cyber attack can be very costly,” Lienau said.

And it can also seriously damage a company’s reputation.

German’s Allianz launched an insurance against all types of online risks to companies in July. And HDI Gerling, a subsidiary of the Talanx group, followed suit, offering tailor-made products to industry since September.

French giant Axa is scheduled to enter the market at the beginning of October, while Zurich Insurance has been offering such policies to SMEs for a year now.

New legislation will come into effect in Europe, requiring companies to report cyber attacks and abide by tougher data protection rules. And that will boost demand for cyber insurance, experts say.

And it is not only companies that are at risk, but the general public too as use of social media, smartphones and online transactions rises exponentially.

In 2011, insurer Swiss Life launched an e-reputation insurance to protect individuals’ online reputation.

French group Axa is offering a “complete family protection” package to cover all digital risks.

Nevertheless, “the market is still not mature. Many clients do not sufficiently evaluate the difficulties they may encounter on the Internet.

There’s still a lot of educating to do,” said a spokesman at Swiss Life.

According to software maker Norton, around 556 million people were the victims of cyber crime in 2012 with the losses estimated at €80 billion.

AFP

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PROPERTY

How to ensure your French property is insured for storm damage

Storm Ciaran’s property-wrecking passage through France - with another storm forecast for the weekend - may have many people wondering how comprehensive their insurance cover is. 

How to ensure your French property is insured for storm damage

In the wake of Storm Ciaran, thousands of property owners in France are preparing insurance claims – with initial estimates of the bill for damage between €370 million and €480 million.

Home insurance is compulsory in France, whether you own the property you live in or you rent – and it must include some level of storm damage cover. 

Check also to see if your insurance provides cover in case of a declaration of a catastrophe naturelle.

The garantie tempête (storm guarantee) covers damage caused by violent winds. What constitutes a ‘violent wind’ varies from contract to contract, but there appears to be a widespread consensus of agreement on wind speeds over 100km/h.

In most insurance contracts, this covers damage caused by the storm and within the following 48 hours – so you’re covered if, for example, a tree weakened by the storm comes down within that period and damages your property.

Be aware that, while the storm guarantee automatically covers the main property, it generally only covers any secondary buildings and light constructions – such as a veranda, shed, solar panels, swimming pool or fence – if they are specifically mentioned in the contract. 

The same is true of any cars damaged by debris. A basic insurance contract might not include storm damage, so it is always worth checking.

Damage must be reported to your insurer as quickly as possible. The deadline for making declarations is usually five days after any damage is noticed. This is especially important for second home owners, who may not be at the property when the damage occurs. 

In some cases – such as in the aftermath of Storm Ciaran – insurers may extend the reporting period. But under normal circumstances, it’s five days after the damage has been discovered.

What happens next

To make a claim, the first thing to do is contact your insurer by phone or email. Your insurer will take you through the next steps, but usually you have to send in a declaration – which should include an estimate of any losses and for any repairs, with evidence where possible, such as photographs and any receipts for purchases. 

Your insurer may also request proof of wind intensity, which can be provided for example by a nearby weather station.

The insurance company may appoint an expert to come and assess the damage, so make sure to keep damaged property safe until they arrive, as well as all invoices for any urgent repair work. 

What if you’re a tenant?

If you rent your property, you must report any damage inside the accommodation to your insurer and also notify your landlord so that they can file their own claim. 

In the case of a co-propriete, you must declare damage inside the accommodation to your insurer, while the trustee sends his own declaration to the collective insurance (which sometimes covers the private areas) .

How long does it take for claims to be settled?

Payment of the compensation provided for by the “storm guarantee” depends your home insurance contract. After the insurer has estimated the amount of damage, compensation is generally paid between 10 and 30 days following receipt of the insured’s agreement.

What if we got flooded?

In the case of flooding, you may have to wait for a natural disaster order to be issued. 

Catastrophe naturelle

The ‘state of natural disaster’ is a special procedure that was set up in 1982 so victims of exceptional natural events, such as storms, heavy rain, mudslides and flooding, as well as drought, can be adequately compensated for damage to property.

The government evaluates each area and deems whether it qualifies for the status of catastrophe naturelle (natural disaster). 

Essentially once a zone is declared a natural disaster, victims can claim from a pot of funds created by all insurers. If the zone is not declared a disaster, insurance companies are under no obligation to pay out. 

Under a “state of natural disaster” residents are covered for all those goods and property that are directly damaged by the phenomenon, in this case storms.

It applies to residential or commercial buildings, furniture, vehicles and work equipment that are already covered by insurance policies.

Homes must be already covered by a multi-risk insurance policy for the status of natural disaster to count.

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