No industry sector is immune from cyber threats, and a round-up of recent headlines and reports underscores the increasing risk and cost businesses face.
Just this week, U.S. Treasury Secretary Jacob Lew urged financial institutions and firms to redouble their efforts against cyber threats and said information-sharing and collaboration among businesses and with government is key.
Speaking at a conference in New York, Secretary Lew noted that the consequences of cyber incidents are serious and our cyber defenses are not yet where they need to be:
Far too many hedge funds, asset managers, insurance providers, exchanges, financial market utilities, and banks should and could be doing more. In particular, it is imperative that firms collaborate with government agencies and with other firms. Disclosing security breaches is often perceived as something that could harm a firm’s reputation. This has made many businesses reluctant to reveal information about cyber incidents. But this reluctance has to be put aside.”
Secretary Lew noted that some banks are already spending as much as $250 million a year to strengthen their cyber security. (Note: this is a cost borne by businesses).
Meanwhile, a new report from the New York attorney general’s office revealed that the number of reported data security breaches in the state more than tripled between 2006 and 2013, with some 22.8 million personal records of New Yorkers exposed in nearly 5,000 data breaches.
The cost to the public and private sectors in New York? In 2013 alone, upward of $1.37 billion, according to the report’s findings.
The Insurance Information Institute’s (I.I.I.) newly updated report Cyber Risks: The Growing Threat (of which I am a co-author) sheds light on the specialist cyber insurance policies developed by insurers to help businesses and individuals protect themselves from the cyber threat.
Market intelligence suggests that the types of specialized cyber coverage being offered by insurers are expanding rapidly in response to this fast-growing market need.
I.I.I. facts and stats on identity theft and cyber security are available here.