- Growing Cyberattacks Raise Demand for Insurance Cover
The rising incidence of cyberattacks in the country has prompted an increased demand by corporate organisations for insurance cover to mitigate the risks.
Insurance operators said they had started designing policies to meet the rising demand of clients, especially in the financial sector who were susceptible to huge financial losses from cyberattacks.
The Executive Director, Leadway Assurance, Adetola Adegbayi, while speaking at a cyber risk seminar in Lagos on Thursday, stated that cyber risk insurance was a new area that insurers were exploring in order to provide value to their clients.
According to her, cybercriminals are taking advantage of improved technology globally to automate their methods.
She explained that the attacks could be from internal sources or external sources, adding that a weak structure and control within organisations would make them susceptible to attacks.
Most times, Adegbayi said organisations covered up these attacks from the public in order to protect their reputation.
“Cyber risk insurance is relatively new and we in the insurance industry are beginning to look at it and say we must play a part in it because the risks that our customers face are changing. Clients’ demands are more and we need to meet these demands,” she said.
She added, “Risk is just for us to understand and provide the appropriate policies to cover it. Before we begin to look at the potential to the industry, we have to examine the security to the client.”
Adegbayi called on the Central Bank of Nigeria to provide regulations that would ensure portions of the mandatory capital reserves by Nigerian banks to be used to provide cover for cyber liabilities.
Nigeria and four other African countries were named among the world’s highest risk countries in the latest Global Threat Impact Index published by Check Point Software Technologies Limited this year.
The report stated that Zambia had the highest risk profile, with Nigeria in the second position while Uganda, Malawi and South African were ranked 7th, 8th and 9th, respectively.
In order to provide adequate support for organisations at risk, the Cyber Risks Manager, The Chubb Corporation, Mr. Gilbert Flepp, said that there was a need for intervention by experts to assist clients in identifying cyber risk and quantifying business impact.
In the area of cyber extortion, which could destroy confidential information, corrupt or delete data stored in the IT system and deny authorised access to a computer system, Flepp said insurers could provide cover for money paid to end the extortion.