Allianz reveals eye-watering cost of cyberattacks

With cyberattacks getting increasingly sophisticated, it has become one of the most significant risks for businesses, resulting in “eye-watering losses” of as much as US$600 billion ($840 billion) a year worldwide, according to global insurer Allianz. Sinead Browne, chief regions and markets officer at Allianz Global corporate and specialty, said much of this loss was uninsured, creating a new market for general insurers. The complexity, sophistication, and global interconnectedness of cyber risk, however, made the risk “incredibly challenging” to model. Allianz’s most recent annual risk survey saw cyber security climb to the second spot on the list of business’s concerns, behind only business interruption, after ranking 15th on the list five years ago. “The average cost of a cyber claim is almost double the average cost of a fire loss that AGCS experiences," Browne told AFR. “The UK government has indicated it believes there are US$600 billion worth of cyber losses annually throughout the global economy. That’s certainly eye-watering.” The Allianz leader said the global interconnectedness of businesses was “leading to vulnerabilities” and that it was up to the insurance industry to understand the accumulation risk that exists with cyber exposure.