A global cyber attack could result in damages of as much as $121.4 billion in an extreme event, comparable to economic losses caused by Hurricane Katrina in 2005, Lloyd’s of London said in a report.
Average losses from a scenario where an attack would cause a widely-used cloud-service provider to fail would be $53 billion, depending on organizations involved and the length of the data storage disruption, Lloyd’s said in the report. Insurers could face total claims in that scenario ranging from $620 million to $8.1 billion, according to the report.
Prominent hacker attacks such as WannaCry in May and Petya in June have raised awareness of the vulnerability some companies have to cyber crime and insurers are seeking to get into the market by offering coverage for such attacks. The global cyber-insurance market is worth between $3 billion and $3.5 billion, Lloyd’s estimates. It could rise to between $8.5 billion and $10 billion by 2020, according to reinsurer Munich Re.
The second scenario used in the Lloyd’s report, where vulnerability in a widely used software was exploited by hackers, could result in losses of $9.7 billion for a large event and $28.7 billion for an extreme event. Insurers would only cover $762 million to $2.1 billion of the cost, the document said.
Was this article valuable?
Here are more articles you may enjoy.