DEPARTMENT: Office Of Risk Management
FILE TYPE: Regular Action
TITLE
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Authorization To Renew Cyber Security Insurance With American International Group, Inc (AIG) Specialty Insurance Company
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PURPOSE/ACTION REQUESTED
Authorize the renewal and purchase of the county's cyber security insurance contract with AIG Specialty Insurance Company.
SUMMARY
Dakota County has carried a cyber security insurance policy since October 2019. In the years since, public sector organizations have experienced a rise in cyber-attacks, including increasingly sophisticated ransomware and data breach incidents. These developments previously drove up insurance premiums and made coverage more difficult to secure.
Recently, however, market conditions have shifted. Greater capacity within the insurance industry and heightened competition have helped ease the market, resulting in stable or slightly reduced premiums-even as cyber threats continue to evolve. A recent market analysis shows that public sector entities renewing their policies in 2025 are commonly seeing rate reductions between 0% and 2.5%.
Over the past several months, staff from the Office of Risk Management and Information Technology have collaborated with Dakota County's insurance broker, Gallagher Risk Partners, to market the County's cyber security insurance coverage. This effort included completing detailed applications and conducting a formal solicitation process. Simultaneously, Information Technology staff have continued to strengthen Dakota County's cyber security controls-an essential factor in enhancing Dakota County's competitiveness in securing cyber insurance coverage.
The County's coverage was marketed on a limited basis since many cyber security insurers do not write policies for public sector entities. As the incumbent insurer, AIG offered a substantial premium reduction for a renewal which further narrowed the competitive pool. Only one other carrier, STARR Insurance, was able to offer a competiti...
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