More than a year into what some have called a 1-in-100 year pandemic with COVID-19, many may be wondering what other unprecedented events could be on the horizon.
For the cyber community, this raises questions about the likelihood of a once in a century cyber catastrophe.
“I think it’s top of mind for a lot of folks these days with all the attacks we’ve been seeing on the headlines the past few years,” says Vishaal Hariprasad, CEO of Resilience Cyber Insurance Solutions, in this episode of The Insuring Cyber Podcast.
While some experts say the cyber insurance industry is still in its early days, cyber attacks have become more frequent and severe, leading insurers to worry about keeping pace.
“The interesting part of this risk is that it’s manmade, right?” Hariprasad says. “And the attackers are very intelligent, using profit driven motives. It’s always evolving. They’re always iterating.”
He says the best thing that insurers can do is think about how their insureds are addressing cyber hygiene, learn from previous losses and advise clients on ways to improve.
Erica Davis, managing director and North America leader for Guy Carpenter’s Cyber Center of Excellence, shares similar thoughts later in the episode, adding that insurers can minimize their potential footprint for systemic events through careful planning, developing and licensing proper tools and proper execution.
“We’ve got new attack vectors that are regularly arising, which no one necessarily has control over, but insurers still have plenty of areas they can control,” she says. “Insurers would be really well-served to work as closely as they can to select and/or to groom their insurance with better cybersecurity controls in practice.”
With all of that being said, some in the industry indicate a cyber catastrophe may not be too far off, while others still say it’s unlikely, at least any time soon. So, who is right?
“I guess that’s the joy of probabilities,” Davis says. “They could either be right, but we won’t know until it happens or it doesn’t.”
She adds that insurers have made a lot of progress in understanding the potential impact of systemic events.
“But, like any ever-evolving peril,” she says, “the learning will always be ongoing.”
Check out the rest of this episode to see what else V8 and Erica have to say, and be sure to check back for new episodes publishing every other Wednesday along with the Insuring Cyber newsletter.
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