BUSINESS INSURANCE
This article is a description and analysis of the responses of insurance companies to global climate politics. The author of the article intends to show that these responses have failed to achieve the initial optimism where environmentalists and commentators had predicted potential involvement of insurers in the field of climate politics. It was expected that insurers would play a significant role in climate politics but an analysis of the insurance company response reveals otherwise. Another objective of this article is the explanation of environmentalists’ disappointment with insurers after the insurers failed to meet their expectations. This article centers on the problem of insurance company’s failure to help in the mitigation of global warming. Environmentalists expected that insurance companies would be involved in the process of global warming where various insurance policies would be used to assist in the mitigation of global warming by helping curb some of the activities that are known to cause global warming. The results of the study indicate that there exist various constraints and opportunities within the business of insurance. The constraints make the involvement of insurers in the fight against global warming difficult. The political-economic contexts in which insurance companies carry out their operations provide limited opportunities for insurers to assist in the mitigation of global warming. The author of the article also found out that environmentalists are not clearly aware of the power of insurers. The misunderstanding of the insurers’ power had led the environmentalists to believe that insurers would help in the mitigation of climate change while in reality; the insurers have limited capabilities when it comes to this issue.
A framework for using insurance for cyber-risk management by Lawrence A. Gordon, Martin P. Loeb and Tashfeen Sohail.
This article focuses on information theft, vandalism, and denial-of-service attacks together with the need for risk insurance. The authors of the article intended to highlight the new and growing market for insurers where businesses can now insure themselves against cybercrime. The authors also intended to show why cyber-crime theft is one of the biggest threats facing various businesses in both information and economic losses. The main problem according to the article is the high number of security breaches reported. According to the article, a survey by FBI found that over 90% of respondents had experienced security breaches in their computers in one year. Furthermore, organizations that were surveyed reported an average of $2 million in losses for each organization. The problem of cybercrime is, therefore, a significant issue that requires extra action by the organizations to protect their properties and data. According to the authors of the article, the solution to this problem is the recently developed policies on cyber insurance. These policies provide coverage against losses that emanate from breaches in the internet leading to information loss. When companies and organizations insure themselves from losses that are caused by information security breaches, they hedge their potential loss from cybercrime. The article goes further to provide a framework that organizations can use in cyber-risk management to ensure information security. The framework follows four steps that include conducting an information security risk audit, assessing the current insurance coverage, evaluating the available policies, and finally selecting a policy. Once the appropriate insurance policy is selected, the organization is now secure from the losses that emanate from information security breaches.
References
Paterson, M. (2001). Risky business: insurance companies in global warming politics. Global Environmental Politics, 1(4), 18-42.
Retrieved April 4, 2016 from: http://www.mitpressjournals.org/doi/abs/10.1162/152638001317146354?journalCode =glep#.VxwV-3pNsQc
Gordon, L. A., Loeb, M. P., & Sohail, T. (2003). A framework for using insurance for cyber- risk management. Communications of the ACM, 46(3), 81-85.
