That cybercrime is a growing — and increasingly expensive — concern is not news at this point.
But, according to the risk experts over at Lloyds in London — the risk posed by a major cyberattack could be much steeper than most of us are imagining at this point.
According to the team at Lloyds, a major global cyberattack could be the start of as much as $53 billion in economic losses. For those keeping score at home — that is roughly the same cost that Superstorm Sandy brought in its wake in 2012.
Risk modeling firm Cyence wrote the report on this subject with Lloyds — and was focused specifically on what would happen in a world where a cloud service provider was successfully hacked and the door was opened for attacks on computer operating systems run by businesses worldwide.
Insurers need this data as they attempt to underwrite potential cybercrime-related loss; but such data is not easy to gather since historical data on an event that hasn’t happened (yet) is obviously nonexistent.
“Because cyber is virtual, it is such a difficult task to understand how it will accumulate in a big event,” Lloyd’s of London Chief Executive Inga Beale told Reuters.
What is clear is that the costs seen so far — say, like the $8 billion global price tag on the “WannaCry” ransomware attack in May — may just be the beginning, as the ledger could get considerably higher. Lloyd’s rather grim estimate follows a U.S. governmental warning that hackers are targeting industrial firms in an effort to gain access to American nuclear and energy sectors.
The Lloyds report also focused on the possibility of a delayed time attack, wherein malware could infect a large business operating system and then lie dormant for a year before popping up to disable the network. The horror of that situation is that the malware, over the course of a year, would be able to spread from the originally infected businesses computer to its users and their clients — meaning when the time bomb goes off, it goes off all around the economy.
The direct loses in such an attack could range from $4.6 billion to $53 billion for large to extreme events. Actual losses over time could be even more according to the report — in the neighborhood of $121 billion.
Lloyd’s has a 20 percent to 25 percent share of the $2.5 billion cyber insurance market.