BOSTON—The most significant threat we face is that to our cyber security, according to former Secretary of Homeland Security Michael Chertoff.
As a guest speaker here at the PCI Annual Meeting, Chertoff said the issue of cyber risk “affects virtually every kind of enterprise.” Considering different motivations—from terror plots to “hackivists,” or just a disgruntled employee or customer—accidental leaks, and the continuation of the creation of access points to information, the “loss is potentially staggering,” he adds.
Countries are additionally tapping into online intellectual property to gain competitive, economic advantages, he warned. And the thing that appears to scare him most is the “very indiscriminate” manner in which probes search for information, looking for anything from business plans to embarrassing emails.
The insurance industry is “critically important” to the country's mitigation of cyber-related risk, Chertoff said.
“Properly done, the insurance industry can play a pivotal role,” in education, sharing information and collective collaborations, establishing best practices and risk management initiatives, he said. Oftentimes the mistake in risk management is to overweigh experience and under-weigh the unknown.
It is better to come up with cyber standards now rather than wait for them to be determined in a “much less thoughtful and deliberate manner” in the courts when a large event, possibly one that results in loss of life, occurs.
The big mistake, he said, is to “think what hasn't happened, won't happen. This one we can see coming.”
He also advised insurers to “look at their own houses.” Another mistake is to view cyber risk coming from the outside-in rather than the opposite.
It will be interesting to note, as the industry continues to push for the reauthorization of the Terrorism Risk Insurance Act, whether cyber terrorism will be included. Again, Chertoff said, it is something to watch because he'd “hate to find out in post-event litigation.”
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
