Discover the impact of a major cloud outage on the US economy
The adoption of cloud computing services is proliferating and it is no coincidence that cyber risk is increasing as well. As more companies rely on ‘the cloud’ to operate, a select few providers have come to dominate the market. This reliance on a small number of companies creates the potential for systemic risk for service users.
Following our Counting the cost: Cyber risk decoded report, Lloyd’s have commissioned a new study in partnership with risk modeller AIR Worldwide. Cloud down analyses cloud service provider failure risk and highlights the expected financial impact on 12.4 million businesses in the US, the most established market for cyber insurance.
The report sets out a ‘detailed accumulation’ modelling approach which provides a more accurate view of risk than standard market share based approaches - using industry exposure database records to identify relationships between vendors and insureds.
This approach can help insurers standardise and improve risk selection and portfolio management and make informed decisions on setting underwriting guidelines, deploying capital, and identifying risk transfer needs.
Lloyd’s have also produced a technical report for underwriters, exposure managers and managing agents in the Lloyd’s market which contains the extended datasets that underpin the model and additional model outputs.