A worldwide tech outage that crippled industries from airlines to banks and caused billions of dollars in corporate and economic losses in July could spur rising cyber insurance premiums to cover not just hacking but also nonmalicious incidents, insurance analysts said.
The global digital meltdown caused by a CrowdStrike software update that went awry is also likely to cause insurers to further refine their policy exclusions and limitations to better manage risks.
“This incident may exacerbate capacity constraints, making comprehensive coverage more challenging to secure for highrisk industries,” Lee Yen Teik, a senior lecturer from the National University of Singapore Business School’s Department of Finance, told Insurance Asia magazine.
“A tiered pricing structure may become more prevalent, where premiums are closely aligned with an organisation's cybersecurity maturity — rewarding robust defences and penalising weaknesses,” he added.
The CrowdStrike incident is amongst the largest cyber events in recent history, with projected direct losses exceeding $5b amongst
Fortune 500 companies alone, Carmel Green, a partner at Reynolds Porter Chamberlain (RPC), separately told Insurance Asia in an interview.
This story is from the Issue No. 23 edition of Insurance Asia.
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This story is from the Issue No. 23 edition of Insurance Asia.
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