Data theft from major email provider is most likely cyber catastrophe, finds Guy Carpenter and CyberCube Analytics
Data loss from a leading operating system provider could rack up insurance losses of more than $23 billion, according to a study of major cyber risks.
The need for insurers and businesses to develop a more granular understanding of cyber risks was another key finding of the study.
Guy Carpenter & Company, a global risk and reinsurance specialist and CyberCube Analytics, a cyber analytics platform, jointly undertook the study, which covered the US cyber insurance market, and examined some of the key drivers of cyber catastrophe scenarios.
It said widespread data loss from a leading operating system provider could cause a $23.8 billion loss. However, it warned that this was a once-in-300 years event. The most likely catastrophe loss scenario was widespread data theft from a major email service provider, said the study, followed by large-scale ransomware at a leading cloud service provider.
The study showed that business interruption (BI) costs, caused when supply chains stall or factories are offline, featured heavily in the insured loss figures. For example, BI made up 94.4 percent of the insured costs associated with a widespread data loss from a leading operating system, while the figure was 92 percent for a long-lasting outage at a leading cloud service provider.
The study also revealed that on an industry basis, financial firms were most impacted during these systemic events, accounting for more than 20 percent of the overall insured loss.
Robert Bentley, CEO, Global Strategic Advisory at Guy Carpenter, said: “As the cyber market continues to expand, the re/insurance industry must develop a much more granular understanding of the potential impact of systemic events.”
Pascal Milliare, CEO at CyberCube Analytics, added: “Through improved data and enhanced analytics, re/insurers can gain a much more granular understanding of these high-impact scenarios, enabling them to allocate capital appropriately and develop more nuanced underwriting strategies."
Guy Carpenter is a subsidiary of Marsh & McLennan Companies.
