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Cyber is a very difficult risk to insure for many reasons. Once an extreme loss event cyber is more an expected or just sitting inside of an unexpected loss for many firms and for insurers. Creating challenges for both the insured and insurer.
For the insured they are reliant on their ability to manage cyber risk, that requires both an understanding of the risk and the application of the appropriate control regime to manage expected losses. With insurance covering the capital gap between the inherent loss exposure and risk management program. For insurers and particularly re-insurers the rapid rise in cyber attacks, the enterprise wide nature of losses and the potential for cyber to be a catastrophic loss is a significant issue to be addressed. Creating aggregated losses for insurers and reinsurers, from single events, at a single point in time, impacting cyber policies across a supply chain and silent cyber losses as attacks bridge IT and OT.
‘Kessler said a cloud provider of critical software being down for an extended period of time due to a cyber incident, or a commonly used software that becomes an access vector for bad actors to deploy malware into victims networks, are both examples of this’
The unpredictable, nature of cyber makes it a challenging risk to manage and insure, far more complex in my opinion than we appreciate. A risk that is receiving more legislative and regulatory focus to facilitate the public and private sector manage the risk and creating additional regulatory compliance risks. We discuss why it is so difficult to insure, https://lnkd.in/dGFVVjCi
Ted Dziekanowski
#theaugustaplan‚Â #cybersecurity‚Â #cyberriskmanagement‚Â #regulatorycompliance‚Â #regulatoryoversight‚Â #cybercompliance‚Â #cyberregulation‚Â #cybergovernance‚Â #sec‚Â #cyberriskgovernance‚Â #ransomeware‚Â #csfprofiles‚Â #governance‚Â #nist‚Â #cyberinsurance‚Â #insurance
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