Insurance Exec Says Cyber Attacks Could Become “Uninsurable”

Many companies take out cyber insurance policies just in case the worst happens. As in they get pwned in a cyberattack of some sort. But it seems like those days may be coming to an end. The chief executive of one of Europe’s biggest insurance companies has warned that cyber attacks, rather than natural catastrophes, will become “uninsurable” as the disruption from hacks continues to grow:

Insurance executives have been increasingly vocal in recent years about systemic risks, such as pandemics and climate change, that test the sector’s ability to provide coverage. For the second year in a row, natural catastrophe-related claims are expected to top $100 billion. But Mario Greco, chief executive at insurer Zurich, told the Financial Times that cyber was the risk to watch. “What will become uninsurable is going to be cyber,” he said. “What if someone takes control of vital parts of our infrastructure, the consequences of that?”

Recent attacks that have disrupted hospitals, shut down pipelines and targeted government departments have all fed concern about this expanding risk among industry executives. Focusing on the privacy risk to individuals was missing the bigger picture, Greco added: “First off, there must be a perception that this is not just data … this is about civilisation. These people can severely disrupt our lives.” Spiralling cyber losses in recent years have prompted emergency measures by the sector’s underwriters to limit their exposure. As well as pushing up prices, some insurers have responded by tweaking policies so clients retain more losses.

To me, this isn’t altogether a bad thing. If a public company gets pwned, and said company and the C level execs who run that company have to explain the pawnage and related loses to shareholders, they MIGHT actually take steps to avoid the attacks or defend against them properly. I say that because so many companies don’t take cybersecurity seriously until it’s way too late. Thus maybe this will be the wake up call that companies need to get their house in order when it comes to cybersecurity.

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