COVER STORY
REASSURING THE RESHORING: A CYBER RISK MANAGEMENT PROPOSAL by Tom Finan, Cyber Growth Leader within Willis Towers Watson
The reshoring of manufacturing to the U.S. and other advanced economies has been a slow but steady phenomenon for many years. A combination of government action spurred by COVID-19, changing economics, and increased automation promises to accelerate this trend. Wherever manufacturers locate, however, the sector is one with significant cyber risk for which most companies are unprepared. Reshoring presents the insurance industry with a unique opportunity to help. Brokers, underwriters and reinsurers should collaborate with manufacturers to develop cybersecurity best practices for reshorers. Companies that implement those best practices successfully should qualify for customized cyber insurance coverage tailored to their specific needs.
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Manufacturing Outlook / November 2020
This “test bed” approach would help create a virtuous cycle of cybersecurity improvement among this small but growing population of companies. Incorporating lessons learned, similar coverage eventually could be extended beyond reshorers to all organizations contending with cyber risk due to converging information technology (IT) and operational technology (OT) systems. This initiative could have positive impacts in the near and long term. With vetted best practices to guide them, IT- and OT-dependent companies could advance their cybersecurity maturity considerably. As insurance industry confidence in those practices builds over time, the cyber insurance market’s capacity to cover related losses would likely expand accordingly. In the process, the cyber resilience
