Global cyber-attack could reportedly cost around $53 billion, or even worse

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However, the high-end of things could push that number up to as high as US$121 billion, which could lead to companies being unable to claim losses from insurers due to a lack of coverage.

A major global cyber attack could cost the worldwide economy £40 billion, with the damage being akin to a catastrophic natural disaster, according to a report by Lloyd's of London.

Average economic losses caused by such a disruption could range from $4.6 billion to $53 billion for large to extreme events. Co-written with risk-modelling firm Cyence, the report examines the hypothetical losses from hacking of a cloud service provider combined with an attack on computer operating systems used by businesses across the world. "It is widely accepted, for example, that natural catastrophes can trigger multiple claims from multiple policyholders, dramatically increasing insurers' claims costs", reads the report.

Lloyds said underwriters should ensure their premium calculations keep pace with the reality of such costly threats.

"We have provided these scenarios to help insurers gain a better understanding of their cyber risk exposures so they can improve their portfolio exposure management and risk pricing, set appropriate limits and expand into this fast-growing, innovative insurance class with confidence", she added. And, in the most extreme cases, losses could rise to as much as $121bn.

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Under the mass software vulnerability attack scenario, economic losses range from $9.7 billion for a large event to $28.7 billion for an extreme event, with re/insurance industry losses ranging from $762 million for a large loss, to $2.1 billion for an extreme event.

The Lloyd's report noted most losses from cyberattacks are not insured, which would leave governments and businesses on the hook if they were hit.

In a 56 page report the insurance market said that the threat of cyber-attacks had spiralled in recent years and now posed a serious threat to both businesses and governments.

The findings come after Lloyd's warned at the end of June of the shocking fallout of a cyber attack on businesses. The uninsured shortfall could be as high as $45bn for the cloud services scenario, and $26 billion in the event of a "mass software vulnerability scenario".

Talking of the challenges cyber-risk modeling presents, Cyence said: "The world's companies are increasingly realising that cybersecurity is not just a technical problem but a business risk".

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