Insurance Commissioner Dennis Funa urged insurance companies to develop cyber insurance products in the wake of the recent “WannaCry” ransomware attacks, or cyber extortions.
Funa said in a statement over the weekend the local insurance industry was a step behind in the development of insurance products specifically designed to protect the insuring public to risks posed by the fast-paced development of the internet-based technologies and activities including its concomitant threats.
Ransomware attacks have already affected hospitals, government offices, schools, major banks and companies around the globe resulting in major interruption of operations due to the lockdown of files and documents in infected computers.
The victims of ransomware were then forced to pay a “ransom” in the form of a bitcoin, a currency used in cyberspace. Since bitcoin, an unregulated currency, is used for the payment of ransomware, it makes it hard for law enforcement officers or agencies to trace its source making it nearly impossible to apprehend perpetrators.
Affected and unprotected industries and individuals were thus forced to shoulder not only the “ransom” paid, but also the economic loss due to significant business disturbance.
Funa encouraged insurers doing business in the Philippines to develop products that would protect individuals and entities against internet-based risks especially since the need for this type of insurance is highly amplified by the recent movements and threats in cyberspace and in computer technology.
Funa said the cyber insurance market had a huge potential for growth as global demands were on the rise and, at present, only one player in the local market was offering this type of insurance product.
“The proliferation of cyber insurance products in the market will also be highly beneficial to the public since more competitive and innovative cyber insurance products, which can directly answer their needs, will be readily available,” Funa said.
“At present, it is only AIG Philippines Insurance Inc. that has an approved cyber insurance policy which is currently available in the market while one leading non-life insurance company had already submitted a proposed cyber insurance and data asset and network security products for approval of the Insurance Commission,” he said.
He said the available cyber insurance product in the market would offer protection against losses due to improper denial or approval of access to data or information, breach to a computer software, system or security, or theft of a computer hardware.
“By optional extension, cyber extortion liability may be covered which provides for payment in case of extortion loss as a result of security threat, as well as payment for the cost of investigation to determine the source thereof. This coverage can directly address cyber attacks such as ransomware,” said Funa.