Marsh has tracked the evolution of cyber risk over the last 20 years as it has grown in scope—from technology failure to cyber terrorism and more. Cyber insurance has become an increasingly crucial coverage option in the property/casualty insurance industry, asserts the global brokerage unit of Marsh & McClennan Cos. Carrier Management spoke to Bob Parisi, Marsh’s network security and privacy practice leader, about the evolution of cyber insurance and why it matters more now than ever. Here are some highlights from the interview.

When did insurers start to take notice of cyber risk?

Parisi: Insurers started to take notice of cyber risk as a risk that could be transferred back in the late ’90s. It was a narrower band of risks at the time, largely focused on the exposures created or being evolved due to the dot.com environment. But 1999 to 2000 is when you first started to see the main players in the traditional insurance markets—AIG, Chubb, [Zurich Insurance Group]—and some London markets start to sell a defined product that you could say “this is for cyber risk.” At the time, it was viewed as a fairly narrow risk, certainly by the buyers.