Cyber Terrorism — Do We Need Federal Government Protection

Cyber Terrorism — Do We Need Federal Government Protection

The U.S. Treasury Department and the Cybersecurity and Infrastructure Security Agency are looking at an idea of forming government-backed insurance for cyber attacks of the businesses that operate the nation’s infrastructure.

It would work much like the Terrorism Risk Insurance Act (TRIA) that was put into place after the 9/11 attacks.

The two agencies have extended public comment on how the concept should work to Monday, December 14th. The notice published in the Federal Register on November 9th wants to know “the extent to which risks to critical infrastructure from catastrophic cyber incidents and potential financial exposures warrant a federal insurance response.”

Until now, the lack of federal cyber insurance has been seen as a way to make sure the people running these critical institutions pay close attention to their security. Since a single incident could end up costing somewhere between a few billion to as much as $1 trillion, insurance companies have disagreed with that decision and want federal backup.

The Risk & Insurance Management Society (RIMS) recently sent a letter to the Federal Insurance Office (FIO) supporting the development of some sort of a well-crafted backstop.

In its letter to the FIO the association said, RIMS and its members have a strong interest in addressing catastrophic cyber incidents affecting critical infrastructure because of the direct and indirect effects on member businesses.”

RIMS said 91% of the organizations responding to a survey it did a few weeks ago said they have purchased cyber insurance. Of that number, 53% said they picked up insurance that has a limit above $10 million and many respondents could not procure desired limits in the private insurance market, demonstrating that the private market is not providing desired cyber insurance coverage.”

Data from the survey found 73% of those purchasing limits of $10 million would have bought a higher limit if it could be found.

Source link: NextGov —

Source link: Business Insurance —

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