The article traces the history and evolution of cybercrime, from the world’s first alleged cybercrime in 1834, when attackers hacked the telegraph system in France, to the modern-day surge in cyberattacks since the 2010s. Despite the overshadowing of cyber risks by other global concerns in the 2022 World Economic Forum’s annual risk tabulation, cyber threats remain a significant concern, especially for businesses. The article emphasizes the increasing prevalence of cyberattacks and the challenges in quantifying the damages and losses they cause. Estimates suggest that cybercrime could result in economic losses of USD 8 trillion globally in 2023, with projections reaching USD 10.5 trillion annually by 2025.
The cyber insurance market has seen rapid growth in response to these threats. While the global market size for cyber insurance was estimated to be between USD 9-14 billion in 2022, the Asia-Pacific region has become a hotspot for cybercrimes with its increasing internet penetration and digitalization. The article highlights the challenges in the cyber insurance market, such as the lack of data, evolving threat vectors, and the potential for large related losses across geographies and businesses. The development of cyber insurance models has become crucial to address these challenges. These models help in understanding the complexity of cyber risks and their ramifications. The article also mentions Peak Re’s collaboration with CyberCube, a cyber risk analytics specialist, to measure a client’s cyber risk exposure and discover insights.
In conclusion, the article stresses that the insurance and reinsurance sectors must strengthen their knowledge of the risk landscape as cyber threats evolve. This requires leveraging models, analytics, data, and collaboration among stakeholders, including governments, to address cyber risks effectively.
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