It’s not natural disasters but cyber attacks that threaten to become uninsurable in the not-too-distant future. For insurance companies, it is gradually becoming unfeasible to cover these risks. If the number and severity of cyber attacks continue to increase, there will be a huge problem.
Mario Greco, CEO at major insurer Zurich Insurance, warned of this in a recent interview with the British business newspaper Financial Times. His New Year’s message will cause cybersecurity to move even higher up the agenda of top executives, hospital directors and municipal administrators. In recent times, insurers have already spoken tough about systemic risks such as pandemics and climate change. But these risks, according to Greco, are dwarfed by the snares looming from ransomware and other cyber attacks.
The Zurich top executive, also active with cyber insurance in the Netherlands and Belgium, sees uncontrollable risks. He questions the consequences if attackers take control of vital parts of our infrastructure. Greco points to the numerous attacks on hospitals, the disabling of pipelines and the hacking of government agencies.
According to Greco, in doing so, the focus was on the privacy risk to individuals. As a result, the bigger picture was missed, according to Zurich’s CEO: “First, there has to be a perception that this is not just data, this is about civilization. These people can seriously disrupt our lives.”
Incidentally, insurers have already taken the necessary measures to limit the financial risks they face. For example, policy conditions have been adjusted to the disadvantage of policyholders. Some cyber insurance policies no longer cover damages if the attacks were made by state actors. More than three years ago, Zurich initially rejected a $100 million claim from Mondelez when that food group fell victim to the notorious nonPetya attack. According to the insurer, it was a “belligerent action” since nonPetya was originally aimed at knocking out power supplies in Ukraine. Later, Zurich and Mondelez managed to reach a settlement.
Last September, Lloyd’s of London urged its members to exclude from coverage damages resulting from attacks by state hackers. Another measure is to refuse customers who do not meet certain security requirements. Across the board, cyber insurance premiums are rising sharply. In 2021, premiums rose an average of 74 percent compared with 2020, according to research by Nationale Nederlanden, Dealroom.co, Mundi Ventures and Mapfre. That increase continued in 2022. Insurers are also considering public-private partnerships in which the government takes over some of the systemic risks.
Cybersec Europe 2023: 19 & 20 April
Cyber attacks are an ever growing threat in todays tech environment. Cybersec Europe 2023 is the platform for experienced cyber security experts as well as next-gen start-ups to share knowledge with peers for jointly coping with the cybersecurity challenges. Businesses and institutions of all sectors learn how to enhance cyber resilience and protect their core. After a successful edition in 2022, the European event on cybersecurity will be back on the ???? ??? ???? ?? ????? in Brussels Expo. Don’t miss out to learn how to enhance cyber resilience and shield your core. You can register for free via the button below.
