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Effect of cybersecurity risk management practices on performance of insurance sector: A review of literature

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  • Ben Kejwang

    (PhD, Chartered Insurer, Chief Executive Officer, College of Insurance, Nairobi, Kenya)

Abstract

Cybersecurity is a set of technologies, processes, practices, and response and mitigation measures aimed at ensuring the confidentiality, integrity, and availability of networks, computers, programs, and data against attack, damage, or unwanted access. Cyber security risk management strategies include limiting data access to avoid putting sensitive information at risk. The purpose of the study therefore is to evaluate the effect of cybersecurity risk management practices on performance of insurance sector. A desktop literature review was used for this purpose. Relevant seminal references and journal articles for the study were identified using Google Scholar. The inclusion criteria entailed papers that were not over ten years old. According to the findings, detected cyber risks need to be properly addressed in order to prevent secondary impacts that lead to vulnerabilities that interfere with the life of insurance institutions and the well-being of their customers. In addition, the study concluded that insurance industry performance can be improved through the implementation of cybersecurity risk management practices. Since it has been found that cybersecurity risk management strategies have a positive and significant impact on the performance of the insurance sector, the research recommends that insurance companies increase their use. Additionally, financial institutions ought to have funds set aside specifically for the purpose of facilitating the retention of risks, in the event that these risks actually materialize. In addition, the research suggests that insurance companies reorganize their product lines or establish premiums that are competitive in order to reduce the threat posed by their rivals and, as a result, prevent the loss of customers to those rivals. The research further suggest that insurance companies adopt appropriate product pricing in line with estimated risk, as this will ultimately lead to increased profitability. Key Words:Cybersecurity, Risk Management Practices, Insurance Sector

Suggested Citation

  • Ben Kejwang, 2022. "Effect of cybersecurity risk management practices on performance of insurance sector: A review of literature," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 11(6), pages 334-340, September.
  • Handle: RePEc:rbs:ijbrss:v:11:y:2022:i:6:p:334-340
    DOI: 10.20525/ijrbs.v11i6.1947
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    References listed on IDEAS

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    1. Lee, In, 2021. "Cybersecurity: Risk management framework and investment cost analysis," Business Horizons, Elsevier, vol. 64(5), pages 659-671.
    2. Nadine Gatzert & Madeline Schubert, 2022. "Cyber risk management in the US banking and insurance industry: A textual and empirical analysis of determinants and value," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 89(3), pages 725-763, September.
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    Cited by:

    1. Wafa Mohammad Abdaljabar & Norhayati Zakuan & Muhamad Zameri Mat Saman & Mariam Setapa, 2024. "The Practice of Enterprise Risk Management and Sustainable Performance in Jordan," Information Management and Business Review, AMH International, vol. 16(1), pages 329-342.

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