The headline-grabbing WannaCry ransomware attack is not expected to bring about any large losses for the insurance industry.
While it is too early to estimate the specific amount of economic or insured losses, industry experts speaking at a risk modelling event in New York agreed that the high profile attack will not result in widespread losses.
“WannaCry isn’t going to be that large for the insurance industry in the US I don’t think,” said Anthony Shapella, risk officer, liability and financial lines at American International Group, during the RMS Cyber Risk Seminar.
The US is the largest cyber insurance market, but most of the systems targeted by WannaCry were located in Europe and Asia, and it is not believed that the ransomware resulted in the theft of any personal data.
Lori Bailey, global head of special lines at Zurich Insurance agreed with Shapella.
“So far, it looks like the WannaCry is not going to be a major pain point for the insurance industry,” she said.
Regardless of the economic impact on the industry, the far reaching attack has already driven business towards both insurers and brokers as firms rush to obtain cyber coverage.
“WannaCry is a wake up call for firms that have not purchased cyber insurance, even in industries that traditionally did not think that they needed it,” Bailey said.
According to Bailey there are estimations that the cyber industry could grow from $3bn to as much as $8bn or $10bn in the next three years alone.
This is a much higher estimate than just two years ago, when PwC foresaw annual premiums reaching a high of $7.5bn by 2020.
The increased growth of the industry will be fueled by events such as the WannaCry attack, and increased regulatory pressures across the globe, even if economic losses are low.
The industry will enjoy a boost from the WannaCry attack, but is still unsure of how to best cover the risk, especially for larger companies.
Some of the largest issues that the industry face are an accurate calculation of probable maximum loss and the designation of what can reasonably be insured.