Cyber risk and insurance news

06 October 2016

Main features in this issue:

Watching their profits fly away

IT outages and cyber attacks are costing the aviation industry dearly. It’s time to consider a new type of cover. No holiday season is complete without pictures of passengers stranded at major airports, and this last summer was no exception. The cause is frequently problems with IT systems. The Delta Air Lines delays in August are just the latest example. A power cut that crashed the airline’s check-in systems, passenger advisory screens, website and smartphone apps resulted in delays across the US, Japan, Italy and the UK. Forcing the company to cancel 2,300 flights, and forcing the CEO to issue a video apology, the outage is expected to cost Delta USD150 million.

Increased cyber vulnerabilities in cars

Doubts persist about whether hackers can access flight controls through other on-board systems on planes. For cars, though, the evidence is overwhelming. Hackers first really demonstrated the vulnerabilities last year, taking control of a variety of systems on a Jeep Cherokee through its internet-connected entertainment system and ultimately shutting it down. The evidence led the manufacturer to recall 1.4 million vehicles and sparked wider questions about the security and vulnerabilities of the Internet of Things (IoT).

Counting the cost: the problem with cyber loss studies

Cyber-crime is a real and growing risk, but assessing its cost is no easy task. A new report by the European Union Agency for Network and Information Security (ENISA) reviews previous studies on the economic impact of cybersecurity incidents on critical information infrastructures. It reveals that the lack of a standard approach makes it difficult to compare studies (which makes it difficult to assess their reliability) and means many are relevant only in their particular context.

US cyber premiums top $1 billion

Cyber insurance take-up continues to drive growth in insurance, as report reveals a broad, strong market. US cyber insurance premiums passed USD1 billion in 2015, according to a report from ratings agency Fitch. The company’s report assesses direct written premiums for cyber coverage at 120 insurers, with almost half (USD483 million) for stand-alone cyber policies, written by 48 insurers. Cyber is the fastest growing insured peril, it confirms.

A new threat landscape for TelCo providers

Cyber security reports by the likes of Kaspersky, PWC and Verizon show the threat landscape is evolving for telecommunication providers. With the world relying on them to keep connected, telco providers operate hugely complex network infrastructures that present a rich landscape for threat actors.

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