A new report has estimated that the total cost of a major, global cyberattack could cost as much as an average of $53 billion in economic losses, a number equivalent to the economic losses incurred due to Hurricane Sandy in 2012.
Published by Lloyd’s of London, the analysis compared the impact of a hypothetical global cyberattack to that of Hurricane Sandy, the catastrophic super storm that created a catastrophic natural disaster in the United States in 2012. The report was published with inputs from risk-modelling firm Cyence which examined the effects of potential economic losses from a possible hack of a cloud service provider to unleash cyber attacks on computer systems and networks run by enterprises and businesses around the world.
More pointedly, the report comes at a time when insurers are finding it hard to comprehend their potential exposure to cyber-related losses in a climate of increasing cyber risks. Further, the lack of any historical benchmark data on which insurer projections could otherwise be made is a major hurdle.
Speaking to Reuters, Lloyd’s of London chief Inga Beale stated:
Because cyber is virtual, it is such a difficult task to understand how it will accumulate in a big event.
According to Cyence, the economic costs of a hypothetical attack targeting a cloud provider would significantly dwarf the cost of damages following the recent ‘WannaCry’ ransomware attack, which stands at an estimated $8 billion, globally. Business interruptions, computer repairs and recovery all fall under the bracket of economic costs.
The report added:
Average economic losses caused by such a disruption could range from $4.6 billion to $53 billion for large to extreme events. But actual losses could be as high as $121 billion.
The hypothetical cloud service attack scenario sees hackers inserting a trojan malicious code into a cloud service provider’s software, to be triggered among users a year after its embedding. Over the space of a year, the malware will have spread among all of the cloud provider’s customers, leading to significant losses due to disruption.
The destructive malware ‘NotPetya’ which spread from infections in Ukraine to global businesses by encrypting data on infected machines is said to have caused $850 million in economic costs.
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