A major cyberattack on a financial services payments system could lead to global losses of $3.5 trillion (R66 trillion), with much of it not covered by insurance, commercial insurance market Lloyd’s of London said this week.
The US would suffer losses of $1.1 trillion over five years from such an attack, which would cause widespread disruption to global business, according to a systemic risk scenario developed by Lloyd’s and the Cambridge Centre for Risk Studies.
China would face $470 billion in losses and Japan $200bn over the same period, Lloyd’s said.
“The global interconnectedness of cyber means it is too substantial a risk for one sector to face alone and therefore we must continue to share knowledge, expertise and innovative ideas across government, industry and the insurance market to ensure we build society’s resilience against the potential scale of this risk,” Lloyd’s chairperson Bruce Carnegie-Brown said.
Cyber insurance saw more than $9bn n gross written premiums in 2022 and was forecast to grow to $13bn to $25bn by 2025, Lloyd’s said.
Concern about the cost of such insurance and whether it will provide cover in the case of war are deterring some potential customers, brokers say.
More than 20% of the world’s cyber premium was placed in the Lloyd’s market, Lloyd’s said.
Major cyber insurers Beazley and Hiscox are among more than 50 insurance companies in the Lloyd’s market.