Supply chain risk and cyber liability are the two classes of business that could be the next successful lines for Bermuda’s insurers.“These are definitely the two subjects that have come up most,” Paul Scope, CEO of JLT Park told The Royal Gazette about his meetings this week at the annual RIMS conference. “I definitely think that both are going to be a successful classes of business for insurance companies.”Several informational sessions at this year’s conference focused around these two topics, particularly after high-profile hacking cases and supply-chain issues arose following the Japan earthquake and resulting tsunami.“Cyber liability has been around for awhile but I think it’s just fermenting with clients where they are starting to take it seriously enough to buy,” said Mr Scope.According to John E Hall Jr, a partner with Hall Booth, Smith & Slover PC, a speaker at RIMS, the average cyber loss for an organisation carries a $7.2 million cost.“For every document that is misplaced or allowed to go into the cyber world, it’s a $214 cost,” he said.Industries that are data focused, said Mr Scope, would be the ones that would seriously consider cyber liability, including utility companies and hospitals.“It’s privacy driven,” he said, adding that customer billing data and patient files that go missing could cripple a company.Aside from losing files to cyber space, hackers breaching a company’s computer system is fast becoming a formidable risk.Scott Borg, chief economist at the research group, US Cyber Consequences Unit, has assessed the annual loss of intellectual property and investment opportunities across all industries at $6 billion to $20 billion.The potential line of business is gaining traction in Bermuda, said Mr Scope.“It’s probably one of those products that once somebody in the industry buys it, the rest will follow,” he said. “They will feel that they have to protect themselves as their peers do.”He explained that the problem up until this point, however, is that there haven’t been enough limits in the marketplace for clients.“Several insurers have been offering it but generally there hasn’t been enough limits for the major clients to take it seriously,” he said. “Their losses can be so potentially big that it’s no point of getting $50 million of cyber liability if their losses are going to be $300 million.”The Thailand floods and Japan quake have also brought supply-chain risk to the forefront, showing that those events have not been adequately covered.According to a white paper published yesterday by global broker Marsh, many organisations still “lack complete visibility into their supply chains and remain vulnerable to the next disaster”.The white paper went on to say that risk managers are still relying too heavily on traditional contingent business interruption (CBI) and contingent extra expense (CEE) products that some experts believe do not provide broad enough coverage.“There’s a business interruption element that, while not a physical loss, could just paralyse a company,” said Mr Scope.After the Japan event, the auto industry was in very scarce supply of black paint as their supplier of black paint couldn’t get the pigment to make it.“If you think about all the black cars for town cars and limos in most major cities, apparently there was a real shortage of them because of that event,” said Mr Scope.Mr Scope said that Bermuda markets will most likely follow what the primary layer carriers are doing, which are typically based in Zurich, US and London.“I have had several meetings this week on that particular topic so it seems that primary carriers are getting their hands around this risk, Bermuda carriers will be receptive to covering the excess risk,” he said.