General Insurance Article - Aon & Ponemon say cyberrisk to sky rocket over next 5 years


The 2015 Global Cyber Impact Report, released today by the Ponemon Institute, a leading research firm on privacy, data protection and information security, and sponsored by Aon plc found that information technology assets are 39 percent more exposed than property assets on a relative value to insurance protection basis. www.aon.com/2015-global-cyber-impact.

 This groundbreaking global study, which surveyed more than 2,200 companies in nearly 40 countries, found that while cyber is one of the fastest growing risks for companies across the globe, and information technology assets are often as valuable as property assets, companies are only protecting 12 percent of those assets compared to 51 percent of tangible property assets.
  
 “This survey is unique as it focused on the relative financial statement impact of cyber incidents compared to tangible asset vulnerabilities,” said Kevin Kalinich, global practice leader for cyber/network risk at Aon Risk Solutions. “The explosion of cloud computing, mobile devices, big data analytics and the Internet of Things is creating enterprise risk management issues that are rapidly growing with the increased use of information assets and technology. Companies large and small are advised to consider cyber threats in this perspective.”
  
 The report’s findings act as a roadmap for risk managers and finance, helping them take a broader look at their organization’s overall risk profile to help establish comprehensive insurance coverage is in place compared to the impact of each risk on the organization,” added Kalinich.
  
 Dr. Larry Ponemon, Chairman and Founder of the Ponemon Institute added,
 “The perception of the risk is interesting. It’s clear that there is a risk and losses can be anticipated, but organizations are not insuring against the risk. This report substantiates a risk manager’s initiatives for how they allocate resources and where they focus.”
  
 Additional findings:
     
  1.   Fifty percent of respondents say their company would disclose the loss of property, plant and equipment in its financial statements. However, 34 percent of respondents say information asset losses do not require disclosure.
  2.  
  3.   Fifty-two percent of respondents believe their companies’ exposure to cyber risk will increase over the next two years.
  4.  
  5.   Nineteen percent of respondents say their company has cyber insurance coverage.
  6.  
  7.   Thirty-seven percent of companies surveyed experienced a material or significantly disruptive security exploit or data breach one or more times during the past two years and the average economic impact of the event was $2.1 million.
  8.  
  9.   Five years from now the projected growth in the use of internet-connected devices will grow from 10 to 50 billion.

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