Major cyber attack could cost global economies £40 billion

A major, cyber attack has the potential to cost global economies and businesses billions. The actual figure could in fact be as much as £40.5 billion, accroding to a new report by Lloyd’s of London. 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 comes as insurance firms attempt to grasp the potential damages of a cyber-related attack. "Because cyber is virtual, it is such a difficult task to understand how it will accumulate in a big event," Lloyd’s of London Chief Executive Inga Beale said.

The report comes in the wake of two major attacks which cost economies billions around the world. The first, the WannaCry ransomware, is estimated to have cost around $8 billion in more than 100 countries. Meanwhile the ‘NotPetya’ malware is said to have caused $850 million in economic damages, according to Cyence. Economic costs typically include business interruptions and computer repairs.

Average economic losses caused by such a disruption could range from $4.6 billion to $53 billion for large to extreme events. But actual losses could be as high as $121 billion, the report said. More worryingly, the report states that as much as $45 billion of that sum may not be covered by cyber policies due to companies not investing enough in appropriate insurance policies.

IT security experts are signalling the dawn of a new era, where attacks like the WannaCry and NotPetya become common place. Farsight Security CEO Dr. Paul Vixie said: "WannaCry recently and now Petya are not the end of an era, but rather the beginning of one. The Internet security and software industries cannot keep up with the complexity of our online systems, but the bad guys certainly can. We must all stop accepting promises of safety from our vendors and start listening to our I.T. departments and other white-hatted technical experts. They are telling us that everything is broken and we have to take that to heart. Patch every day. Back up every day.”