The cyber-insurance market is experiencing concern about potential war-related risks and artificial intelligence (AI) threats in 2024. The ongoing wars in Ukraine and Gaza have led to high alert for insurers, with many companies no longer offering coverage due to the unpredictability and impact of these conflicts. The insurance industry is witnessing a significant increase in concerns about cybersecurity risks in the coming years.
Ransomware attacks are a major contributing factor to these growing concerns, with an example being the NotPetya virus that originated in Ukraine and quickly spread globally. The potential for war-associated risks to have an impact on companies worldwide through tactical ransomware has caused insurers to exclude war-related risks from their policies. This has left clients uncertain about how to manage their cybersecurity strategy.
Conventional policies have typically excluded war-related risks, and the cyber-insurance sector has taken longer to address these issues. Furthermore, updated SEC rules require firms to disclose hacks within four days, increasing the potential for bad PR and heightened investor scrutiny for companies affected by cybersecurity breaches. As a result, insurers are closely monitoring how these changes will impact damages and payouts for their clients.
Overall, the cyber-insurance market is grappling with the unique challenges posed by emerging cybersecurity threats and the various geopolitical complexities affecting the industry.