2169

Views

Lloyd's: Multi-Port Cyber Attack Could Mean $101 Billion Insurance Gap

file photo
file photo

By The Maritime Executive 2019-10-30 19:28:55

Lloyd's has released a new report Shen Attack: Cyber risk in Asia Pacific Ports which explores a hypothetical cyber-attack on major ports across the Asia-Pacific.

Shen Attack depicts a plausible scenario in which an attack is launched via a computer virus carried by ships, which then scrambles the cargo database records at major ports and leads to severe disruption. An attack of this scale would cause substantial economic damage to a wide range of business sectors globally due to the inter-connectivity of the maritime supply chain.

The report estimates that losses of up to $110 billion would occur in an extreme scenario in which a computer virus infects 15 ports. The scenario estimates that transportation, aviation and aerospace sectors would be the most affected ($28.2 billion of economic losses in total), followed by manufacturing ($23.6 billion) and retail ($18.5 billion). Productivity losses affect each country that has bilateral trade with the attacked ports. Asia would be the worst affected region, set to lose up to $27 billion in indirect economic losses, followed by $623 million in Europe and $266 million in North America. 

The report indicates the global economy is under-prepared for such an attack with 92 percent of the total economic costs uninsured, leaving an insurance gap of $101 billion.

The report is the second publication from the Cyber Risk Management (CyRiM) project, the Singapore-based public-private initiative that assesses cyber risks, of which Lloyd’s is one of the founding members.

The report is available here.