How can the cyber insurance market respond to risk with few boundaries? As cybercrimes continue to increase along with the intensive media coverage of privacy breaches and ransomware attacks, cyber risks complacency could become a thing of the past. In a recent article, the OECD explored some of the challenges accompanying insuring cyber risks, common types of cyber incidents and their potential losses, and enabling the cyber insurance industry.
“The numbers alone should motivate any firm, large or small, to rev up its cybersecurity game,” states the OECD article.
Companies are increasingly aware of cyber risks and are investing more and more in cybersecurity technology and services, with a 7% increase in spending reported from 2016 to 2017. As such, global expenditure for 2018 is expected to reach $93 billion whilst cybercrime is expected to cost businesses over $2 trillion by 2019. From data confidentiality breaches to operational technology malfunctions and from data corruption to cyber fraud and theft, different types of cyber incidents can lead to potential losses with long-term effects on businesses, especially on small firms that are particularly vulnerable to these attacks.
The evolving nature of cybercrime means that risk models are obligated to look beyond historical data to understand exposure and ensure that policies are in line to enable the cyber insurance industry to become a driving force in supporting national cyber risk mitigation and resiliency. Nowadays, new forms of malware and other technologies target operating systems, common apps, cloud services and hardware platforms: one criminal act has the potential to scale to global dimensions.
Strengthen your role at FERMA Seminar
Day 2 of our seminar will be focusing on cyber risks, helping risk managers through various workshops and by discussing key risk areas.