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Gaps and overlaps in insurance: Turning costs into investment

Bridging the Gap Blog Series

By Laura Kelly | June 11, 2024

Learn more on how data can help support insurance buying strategies to ensure gaps and overlaps are mitigated.
Financial, Executive and Professional Risks (FINEX)|Risk Management Consulting

Welcome to another addition of our ‘Bridging the Gap’ blog series. This time we are investigating the potential gaps and overlaps seen between insurance policies and how data is important to ensure the right buying decisions.

What are my key risks and which insurance policy will respond?

We all understand and appreciate that insurance is purchased to cover risk and therefore protect businesses. However, often overlooked by businesses is the value of fully understanding how insurance is going to respond in the event of a claim.

Unfortunately, this can lead to gaps in coverage and overlaps where more than one policy is responsive to that risk, resulting in missing coverage where coverage is possible and unnecessarily increasing costs. This is particularly relevant when, as indicated by the Global Directors’ and Officers’ Survey Report 2024, the number 1 factor influencing the decision-making process for insurance purchases is cost. Are companies therefore unnecessarily increasing their risk exposure in an attempt to save cost?

A bar graph indicating the number one factor influencing the decision making process for insurance purchases.
Cost is number one.
An extract from our Global Directors' and Officers' Survey Report 2024

How do gaps and overlaps occur?

A good example of where gaps occur is in the area of computer/cybercrime and in particular the scenarios around social engineering, also known as payment diversion, account impersonation or account takeover. This is now recognised globally as one of the largest emerging types of fraud.

WTW risk and insurance analytics indicates that traditional insurance coverages are being tested with such social engineering losses and that there is a cross over between cover under crime and cyber policies. This brings with it a risk of coverage gaps or duplication of cover between the policy types. For example, depending on the specific language of the crime policy, losses can be excluded for reasons such as there being no computer violation or the insured knowing about and consenting to the transfers.

Additionally, although often notified to cyber liability policies, crime (and professional indemnity in specific circumstances) policies are more likely to provide coverage for any stolen funds if the cyber policy contains a specific social engineering/fraudulent transfer insuring clause.

It is therefore imperative that understanding how these types of scenarios will impact your business and how your insurance specifically responds should be a high priority for all organisations

How do we minimise the gaps and overlaps?

Key to maximising coverage and reducing gaps is to thoroughly consider how your current insurance policies would respond to your key risk scenarios. Not only will this will this provide confidence in your insurance strategy but it will clearly identify where gaps and overlaps occur. This qualitative analysis should always include comprehensive claims data[1] to allow you to understand how insurance has responded to similar scenarios and has the added benefit of providing insight into the cost breakdown of each claim.

Example Qualitative Analysis:

A table showing the financial impact of a cyber denial of service attack and what is expected to be covered
Example scenario of a cyber denial of service attack

Having the right buying strategy based upon sound methodology and supporting data is key to maximising insurance coverage and turning insurance buying into a strategic investment.

Contact WTW Today

Contact a member of our team to understand how WTW can empower you and develop an insurance strategy fit for your firm through our risk and insurance analytics services.


  1. WTW Claims and Insights Database over 40,000 claims notifications and detailed breakdowns of cost to 170 fields including root cause analysis. Return to article

Associate Director, Sales and Client Management, ORS – FINEX GB


Paul Search
Head of FINEX Risk Solutions – FINEX GB


Bridging the gap between risk and insurance

Determining the right amount of insurance coverage for your business is crucial. Too little, and you're exposed; too much, and you're paying for protection you don't need. Our Operational Risk Solutions can help you identify, quantify, and transfer risks and recommend the optimal level of insurance for your organisation's risk landscape.

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