As cyber attacks climb in Australia, insurance is racing to catch up
The Australian insurance industry is struggling with working out how to properly measure and price cyber risk.
In a digital world, cyber risk is simply a part of life. But the regularity with which digital attacks can occur and the rapidly changing nature of the technology used by criminals to compromise systems are posing a significant economic challenge for insurers and other businesses.
Insurance Council of Australia chief executive Andrew Hall tells Capital Brief in an interview that insurers are still struggling to get to grips with cyber. Even more worrying, it’s not clear when there will be a breakthrough.
“It has been a challenging area to underwrite in the last few years because the nature of cyber has been expanding and changing,” Hall says.
One of the issues is the lack of data to be able to accurately estimate risk and therefore put an appropriate price on policies. More institutions and regulations, including the Australian Prudential Regulation Authority, are collecting data. But Hall said it still needs to be easier for businesses to report in real time that they’ve had a cyber incident.
