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AON, Guidewire Take Measures to Deal With Cyber Attacks

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Aon plc (AON - Free Report) along with Guidewire (GWRE) announced that the former is implementing the latter’s Cyence Risk Analytics risk selection and accumulation management products. This strategic move will help clients underwrite cyber insurance in a better way and strengthen Aon’s presence in cyber risk management space.

The current year has been a witness to several high-profile events so far, which raised re/insurers’ concerns about the possible cyber thefts. The COVID-19 pandemic prevailed a 360-degree change in the way businesses are operating. This exposed companies to intensified cyber risks. The unfortunate increase in ransomware events pushed re/insurers to reassess rates, terms and conditions, and underwriting standards.

Aon is banking on the bright prospects of the cyber risk management market, given the growing use of information technology by companies around the world. Moreover, with cyber risk becoming more complicated and severe each day, stringent management to deter data theft is the need of the hour.

Aon will be able to leverage Guidewire’s extensive cyber data listening and modelling-collection abilities. The leading insurance broker will be able to model client portfolios and reduce current volatility.

In this evolving cyber insurance and reinsurance market, Aon will be able to build new solutions aimed at underwriting and reinsuring cyber risks. At the same time, the presently Zacks Rank #3 (Hold) insurance broker will reduce cyber accumulation and ripple effects. Guidewire Cyence is the perfect fit for this move as it provides analytical solutions to measure the financial impact of cyber risks as well as diminish the incident trends. Aon is thus well-poised to capitalize on the rising demand for cyber-risk protection. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In 2018, Aon tied up with Guidewire Software to manage hypothetical attacks by hackers on a U.S. hydroelectric dam. Aon keeps no stones unturned when it comes to addressing cyber insurability challenges. In October 2021, it launched an offering to enhance the resilience of businesses in the UK and Europe, the Middle East and Africa (EMEA).

Shares of Aon have gained 41.9% in a year’s time, outperforming its industry’s growth of 25.9%.

Zacks Investment ResearchImage Source: Zacks Investment Research

Insurers are suffering mounting losses due to data thefts and therefore, other insurance brokers are also taking measures to fight the same.

For instance, Marsh & McLennan Companies Inc. (MMC - Free Report) unveiled a Cyber Risk Analytics Center that help companies provide clients with view of cyber threats. MMC also agreed to collaborate with the cybersecurity ratings company BitSight to provide improved services to clients. The deal will likely enable Marsh & McLennan to help organizations make better judgment in relation to cyber risks.

Stocks to Consider

Some better-ranked stocks in the same space are Brown & Brown, Inc. (BRO - Free Report) and Ryan Specialty Group Holdings Inc. (RYAN - Free Report) .

Brown & Brown has witnessed its 2021 earnings estimate move 0.5% north over the past 30 days. BRO came up with a trailing four-quarter surprise of 18.3% on average.

Ryan Specialty Group Holdings has witnessed its 2021 earnings estimate move 7% north over the past 30 days. RYAN managed to come up with a trailing four-quarter surprise of 41.18%, on average.

Shares of Marsh & McLennan, Brown & Brown and Ryan Specialty Group have gained 46.1%, 47.7% and 37.6%, respectively, in the past year.