The business world is transmogrifying before our very eyes, necessitating a wholesale re-think of the legal issues and risks surrounding it. The rise of technology is transforming manufacturing companies into software businesses, using increasingly digitised processes, with factories and plants controlled by computers - and mechanics gradually morphing into software technicians; services firms too are increasingly resembling software or data houses, now that so much business is conducted online and in the cloud. The nature of crime is changing also.
This October saw the Office for National Statistics showing cyber crime as a separate category of offence in the official crime figures, and the result is illuminating: whilst traditional crime is falling eight per cent, online fraud and cyber attacks now account for half of all crime. The big question is: how prepared are we for this new cyber age? The challenges here are particularly acute for the (Re)insurance industry, responsible for underwriting these new risks for businesses and individuals. As the very nature of risk changes as old risks manifest in new ways – the industry needs to decide how it is going to measure them, and then how to provide cover.
The trouble is of course, that the bank of historical data needed to calculate risk in the future, simply doesn’t exist. Indeed there is a paucity of data generally around cyber risk. This is why we decided to conduct this Cyber Risk Survey, as our contribution to our unique project process. We believe the effects of the cyber revolution will be as transformative and far-reaching as those of the industrial revolution almost 200 years ago. We need to be ready for it.