Re/insurers’ operations uncovered to cyber threats, says S&P

In keeping with a brand new report by S&P World, insurers and reinsurers are exposed to cyber threats, with the potential for a direct assault to affect their operations, probably costing them a good portion of their common annual earnings.

Re/insurers face varied operational cyber dangers, together with IT system outages, outages of third-party IT companies, knowledge breaches, protection prices, legal responsibility for safety occasions, and ransomware assaults.

S&P emphasizes that the rising digitization of the sector, along with the widespread use of shared networks and companies, will increase insurers’ vulnerability to cyber assaults.

Regardless of these dangers, S&P believes that international multi-line re/insurers are, in common, properly positioned to handle their direct cyber threat publicity. This is because of their superior threat administration techniques, robust monetary capital, regulatory oversight, and experience in cyber insurance coverage underwriting.

To this point, cyber incidents have had minimal affect on the creditworthiness of world reinsurers. Nevertheless, S&P warns that this might change quickly as cybercriminals grow to be extra subtle. Insurers are prime targets for assaults because of the giant quantities of priceless buyer knowledge they maintain.

S&P concludes that almost all giant re/insurers are more likely to stand up to the monetary affect of direct cyber assaults. Their capability to soak up operational cyber dangers is supported by diversified income streams and robust capital adequacy, ensuing from robust and prudent regulation.