Cyber risk management impacts insurance pricing and credit ratings: S&P

Despite a growing interest in cyber insurance, the organisational structures, workplace culture, and wider risk management ecosystems that combine to minimise cyber threats are still often lacking, cyber experts told S&P Global Ratings.

They also highlighted that insurers are assessing their clients’ cyber preparedness to determine the cost of their premiums, among other things, and that cyber risk management can impact credit ratings.

At the S&P Global Ratings webinar “Cyber Spotlight: 2023 Cyber Trends And Outlooks”, experts highlighted that the interest in insurance is unsurprising given the size of the financial challenges posed by cyber threats and the fast-changing and still nascent nature of the cyber insurance market.

Simon Ashworth, Chief Analytical Officer, Insurance Ratings, S&P Global Ratings, said: “The economic costs of cyber dwarfs any comparable economic loss estimation, including perils such as natural catastrophe, so the potential for this market is huge.

“And in terms of insurance coverage, we are talking about 1% of [potential] economic losses that are currently covered. So there is a huge insurance protection gap.”

According to S&P Global…