Sure Thing

Readers write to say more insurance M&A is on the cards; executives should face facts on data security breaches; and employee behaviour can be a clue to internal fraud.


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Your article “Solvent Survivors” (April) was timely in predicting that the insurance sector will face an uptick in M&A activity internationally, despite the difficult conditions.

Research conducted by Accenture among 100 insurance equity analysts around the world came to the same conclusion. Traditionally mergers in the insurance sector have been about gaining scale and cutting costs. Now the expectation is that mergers will be about transforming business models and entering emerging markets, so that growth is based on efficiency.

Indeed, more than three-quarters of analysts rate operational efficiency improvement programmes as the most important use of capital after share buybacks and dividend increases. Meanwhile, analysts are looking to reward insurance businesses with bold visions for longer-term opportunities in emerging markets. Europe’s winners will be insurers that have flexible, scalable and efficient operations, and can use this as the basis for striking the best partnerships and joint ventures in these new markets.

Peter Courtney
Head of UK Insurance Practice, Accenture
Manchester, UK

The Truth about Security

I was interested to read your piece on data security and companies’ attitudes towards it in “Firewall of Silence” (April). Companies certainly need to protect themselves against more than just hackers. There are myriad risks that call for a thoroughly planned, well-implemented IT security system.

From a purely technological point of view, the IT-security industry is able to be a step ahead of most hackers nowadays. But as shown by some recent incidents — including threats from corporate blackmailers — technology must be only part of a company’s security strategy.

Well-protected companies not only keep their data safe, but also guard their entire business against both hackers and other events such as natural disasters and human error.

Günter Klausner
CFO, Phion
Innsbruck, Austria

“Firewall of Silence” highlights some of the unspoken truths about the current climate of data breaches and security incidents. Employers are constantly blaming hackers because they don’t want customers, journalists or class-action lawyers focusing on the reality: that the majority of data breaches are the fault of employees. Admitting that most of your data breaches are the fault of insiders who didn’t know any better is a leap most executives don’t have the courage to take. Until executives are held personally responsible for security breaches, things will just get worse.

Neal O’Farrell
CEO, My Security Plan
Walnut Creek, California

Finding Fraud

Employee behaviour can indeed give plenty of clues to observers that a fraud is being perpetrated (“To Catch a Thief,” March). One of the biggest clues of all is a change in lifestyle.

We undertook one investigation which revealed that the most expensive car in the car park belonged to the procurement manager. The car suddenly disappeared when the suspected fraudster got wind of our suspicions. We uncovered a large case of bribery and corruption involving the procurement manager, and other senior staff who had turned an accommodating blind eye.

Andrew Durant
Managing director, Disputes and Investigations
Navigant Consulting
London, UK

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