The overwhelming majority of risk professionals worldwide expect the frequency and severity of cyber attacks to increase as a result of the COVID-19 pandemic, according to Willis Towers Watson (WTW).
After surveying nearly 1,000 risk experts, WTW found that 86% believe the frequency of cyber attacks will increase, while 54% expect the severity of attacks to rise.
The respondents – a cross-section of risk management, claims, underwriting, legal, broking, and analytics professionals across 56 countries – believe cyber losses will be divided almost evenly between data breach, ransomware, and business interruption.
Before COVID-19, only 13% of respondents thought that a catastrophic cyber event leading to insurance claims of $10bn (£7.9bn) or more was “likely” during the next five years, however, now 33% believe this is at least a five-year event.
“This year’s survey shows quite clearly that risk professionals around the world believe that the pandemic has increased cyber risk, in some cases dramatically,” said Mark Synnott, global cyber practice leader at Willis Re.
The forecast rise in post-COVID-19 losses may be a result of the sudden, wide-scale transition to remote working, since the shift has increased the cyber vulnerability of many businesses.
Views on the perceived increase in frequency vary little by geography, but 68% of Asia-Pacific respondents predict a rise in severity, compared to only 37% of European risk specialists.
Concerns around a catastrophic attack resulting in $10bn or more in insurance claims is greatest in Asia-Pacific.
Synnott continued: “While three-quarters of the people we surveyed think demand for cyber cover will increase post-COVID-19, only 45% think supply will increase, which perhaps explains why three-quarters think the cost of cover will rise.
“The insurance industry has some work to do to ensure these expectations are not met.”
Image credit: iStock
Author: Chris Seekings