Sedgwick, IBM Team Up On E-Biz "Safety Net"

N/Aany%> and IBM have joined together to develop a multifaceted package of consulting and risk transfer services to cover security breaches to corporate computer networks. The offering will wrap insurance coverage developed by Sedgwick around a range of IBM consulting services. Its creators say it is designed to help companies control security breaches, reduce related risk, and address the stability and security concerns that have kept many companies from venturing onto the Internet with electronic commerce activities.

By complementing the insurance coverage with IBM consulting services, Sedgwick looks to help companies control and reduce computer risks, as well as manage the after effects of security breaches if they do occur.

According to Sedgwick executives, the company's goal is to become a "risk management partner" with customers, which will help give them confidence to embrace the Internet as a desirable medium for consumer and business applications.

"What we've done with these products and services is create a safety net that will boost companies' confidence to engage in e-commerce," said Sara Benolken, national managing director of Sedgwick Technology Group. "The combination of IBM's insurance industry expertise and broad experience in the world of computer security consulting is a major factor in enabling us to introduce this coverage. We believe it is unprecedented in its scope and will be extremely popular."

According to Virginia M. (Ginni) Rometty, global general manager of IBM Global Insurance Solutions, "With the emergence of e-business and the power of the Internet, insurance and financial services companies are compelled to explore new approaches to delivering value within emerging networked business models. In working with Sedgwick, we are helping the industry reach a much higher level of security in their use of new electronic distribution channels. As one of many upcoming agreements in this arena, we are very pleased to be working with such an innovative team from Sedgwick on this project."

Under the offering, IBM will perform an e-commerce "health check" on prospective customers. This assessment of a company's Internet-based activities and internal computer network will define the scope of a company's risk and how it can potentially be reduced through a combination of risk control measures and insurance coverage.

By leveraging IBM's global expertise in Internet security and insurance and financial services issues, Sedgwick believes it can better provide companies with insurance against first- and third-party losses due to computer security breaches, such as network hacking, viruses, and electronic thefts.

In addition to initial risk assessments, IBM will offer Sedgwick's customers a comprehensive suite of risk control services to help protect companies engaged in electronic commerce. These services will include Internet exposure workshops, claims processing guidelines, periodic e-commerce security checks, Internet emergency response, business recovery plans, investigative and forensic work, and "hot site recovery" services which ensure that if a disaster brings down a company's computer system, a backup is immediately available.

Sedgwick has already begun offering various IBM consulting security services to its customers. The program being announced will initially be targeted at two potential markets: companies wanting to sell on the Internet, and technology companies servicing the Internet, such as Internet Service Providers (ISPs) and Website developers.