2026-10-26 · Source: Insurance Business New Zealand
Summary in 3 Points • New Zealand's regulators have issued guidance on cyber risk management amid rising AI threats. • The NCSC reported 369 incidents of potential national significance in the last year, highlighting increasing cyber vulnerabilities. • Brokers must adapt to heightened scrutiny on insurers' cyber governance and third-party dependencies. --- New Zealand's financial regulators, the Reserve Bank of New Zealand (RBNZ) and the Financial Markets Authority (FMA), have set new supervisory expectations for insurers regarding cyber risk management in light of advances in frontier artificial intelligence (AI). This guidance, delivered at an industry roundtable, emphasises the need for stronger governance and operational resilience, particularly in managing third-party dependencies and addressing AI-enabled fraud risks. The NCSC's Cyber Threat Report 2026 revealed a rise in significant cyber incidents, with 44% linked to criminal actors, underscoring the urgency for insurers to enhance their cyber defences. For brokers, these regulatory expectations translate into practical implications across various lines of business, especially in cyber insurance. Insurers will need to demonstrate improved cyber governance, which may impact their incident response times and management of provider risks. Brokers advising clients on cyber cover should be particularly aware of the focus on third-party concentration risk, as reliance on single providers could lead to gaps in policy coverage. The evolving landscape of AI-related risks necessitates that brokers remain vigilant and proactive in their advisory roles. Insurers must enhance cyber governance in response to regulatory expectations, impacting claims processes and third-party risk management in the cyber insurance sector.
Insurers must enhance cyber governance in response to regulatory expectations, impacting claims processes and third-party risk management in the cyber insurance sector.