Inaugural Event Draws 65 Communications, Media, and Technology Risk Professionals

Advances in technology over the past several decades have enabled communications, media, and technology (CMT) companies to venture beyond their historical core competencies and explore each other’s territories. As a result, CMT companies need to broaden their traditional definition of “catastrophe” to include more than natural disasters and other physical loss scenarios, experts warned at Marsh’s recent inaugural CMT Risk Forum.

The convergence of media content, media distribution, communication networks, and information technology has changed the liability risk profiles of many CMT companies and increased their exposure to catastrophic losses. At the same time, the rise of social media, privacy concerns, and cloud exposures also are contributing to the shift in risk profiles among CMT firms. The risks of data breaches and other events related to such exposures have the potential to impact a CMT company’s balance sheet as much as, or even more than, an earthquake or other natural disaster.

Marsh’s risk forum, titled “A New Era of Catastrophic Risks,” brought together 65 risk professionals from the nation’s leading CMT companies, to discuss these emerging risks and how best to protect against them.

Among the major issues discussed at the forum, held in San Jose, California, were:

• lessons learned from this year's unprecedented natural disasters, including the extent of supply chain and business interruption losses;
• increased complexity of data and privacy breaches, including the unique exposures to cloud computing;
• emerging technology errors and omissions risks and the insurance challenges faced outside the U.S.;
• heightened intellectual property risks and the limited protection provided by the insurance markets; and
• rising environmental liability exposures especially related to products manufactured overseas.

“CMT companies face a wide array of emerging risks that fall outside their traditional core business that need to be better understood, measured, and mitigated,” said Tom Quigley, U.S. Leader of Marsh’s CMT Practice. “Whether it’s a large earthquake half-way around the world or a cloud provider’s network going down, CMT companies could be exposing their balance sheets to losses if they do not properly identify and manage these risks.”

Marsh will hold its 2^nd annual CMT Risk Forum next Fall. More information about Marsh’s CMT Practice can be found here.