The cyber insurance market in Singapore is forecast to grow by 50 per cent this year. More businesses are now taking action to mitigate the high reputational and financial risks associated with cyber breaches.
As Singapore gears up in its drive to be the world’s first Smart Nation, new interconnected technologies and increasing automation mean a rise in threats of cyber attacks and sabotage for all companies, according to AIG Asia Pacific Insurance.
«While cyber attacks grow in size, volume and sophistication, defensive methods and technologies have not seen a corresponding evolution, potentially costing businesses millions in the event of a cyber breach,» said Lai Yen Yen AIG Singapore’s Head of Financial Lines.
Threat to Banks
AIG Singapore expects strong demand for cyber insurance to continue from finance and technology companies, and new demand to emerge from healthcare companies. The insurer also forecasts cyber risks in 2016 to range from both internal and external factors, including lack of data encryption, increased use of malware, and outsourcing to third party providers.
«Not only do data leaks result in financial losses including compensation payouts and regulatory investigation, but reputational damage and loss of consumer confidence can also have a long-term impact on a company’s bottom line,» added Lai.
AIG was the first insurer to launch insurance cover against cyber attacks in Singapore in 2012.
