Councils are uniquely exposed to cyber risk and should give greater consideration to specific cyber policies, Aon says.

But sector heavyweight JLT says this is not new information – and it has been offering cyber cover to councils for more than three years.

Aon says local government organisations are increasingly dependent on electronic information assets, and are a primary target for “hactivists”.

It says standard policies were not intended to cover many risks associated with an increasingly digital world.

“Experience shows that no system is impenetrable, and even top-notch, state-of-the-art cyber security is vulnerable,” Aon says.

“In an increasingly punitive legal and regulatory environment, and in the face of more frequent contractual insurance requirements specifying cyber liability, forward-thinking councils are taking proactive steps to explore and transfer cyber risk.”

Aon declined to comment further on its local government strategy, a sector traditionally dominated by JLT, which manages mutual insurance schemes across the country.

JLT MD Public Sector Stephen Penfold told insuranceNEWS.com.au councils’ exposure to cyber is “nothing new” and one-third of councils Australia-wide already have specific cover.

“We think we are pretty good at predicting what councils’ exposures are going to be – we’re ahead of the game.”

Mr Penfold admits competition in the sector is increasing, but says JLT’s extensive experience stands it in good stead.

“There is increased competition in every market at the moment and local government is no exception,” he told insuranceNEWS.com.au.

“There are other brokers trying to get some business, but they are not having a lot of success. They are going backwards rather than forwards. We have been a specialist in this market for more than 30 years and most of our members are very happy with the mutuals.”