17th October 2021

Fitch analyses global Insurers cyber risk

The latest report from Fitch Ratings uses SecurityScorecard’s(SSC) grading platform to analyse the cybersecurity risk of over 400 global insurance companies, representing approximately two-thirds of global insurance premiums.
The report found that that there is a positive correlation between the agency’s credit ratings, and SSC’s cybersecurity grades. This implies that insurance companies that focus on managing their own credit risk tightly also appear better at managing their cyber risks. The report also explores associations between SSC grades and other attributes such as country and sector, as well as key financial attributes including capital strength, profitability and size.
"The global insurance industry experienced several high-profile cyber events in 2021," said Fitch Global Insurance Group head Keith Buckley. ‘In particular, ransomware is an industry issue that is a growing concern. As a result, cyber is becoming increasingly important to our ratings analysis."
SSC’s cybersecurity grades provide additional insights not captured by traditional financial statement and credit analysis. Fitch director Gerry Glombicki points out, "Instead, systems attributes such as network segmentation, attack surface, endpoint security and digital footprints are most important in understanding an insurer’s cyber health. Fitch’s partnership with SSC gives Fitch insights into these considerations, and helps us better assess cyber risk."
Organisational complexity creates challenges in evaluating cyber risk and interpreting SSC scores, and the report includes an example of this focused on financial conglomerate Berkshire Hathaway.
Exploring the Insurance Industry’s Cybersecurity Risk" is available at ‘ www.fitchratings.com.

Fitch Trends(333 articles)
Cyber Trends(1,181 mentions in Insurance Newslink)