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AIR Worldwide, security risk firms collaborate on advanced cyber model


September 14, 2015   by Canadian Underwriter


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AIR Worldwide will work with security risk and cyber data providers BitSight Technologies and Risk Based Security (RBS) to build an advanced cyber risk model.

AIR Cyber Risk Model will seek to help the insurance industry better manage the evolving threat of cyber attacks by incorporating “the most up-to-date and complete incident data, real-time security ratings of companies, exposure data, and supplier data in the ‘cyber supply chain,’” notes a statement from catastrophe risk modeling firm AIR Worldwide, a Verisk Analytics business.

Cat risk modeller, security risk firms partner on advanced cyber risk model

BitSight will gather terabytes from sensors deployed across the Internet – including the company’s security ratings by industry, company size and company headquarters location – while RBS has provided AIR with historical incident data – containing industry-specific details on threat vectors and vulnerabilities and data breach information on businesses, industries and geographies – on more than 16,000 breaches.

The information will then be levered by AIR Worldwide. Leveraging the key data assets “is a major step forward in developing a robust cyber model,” says Scott Stransky, AIR Worldwide’s manager and principal scientist.

Beyond probabilistic loss estimation, the AIR Cyber Risk Model will offer a set of deterministic scenarios that will allow companies to begin to truly understand their aggregated risk from large-scale cyber attacks, the statement notes.

“We’re developing a comprehensive cyber industry exposure database that can enable us to better estimate potential financial losses to entire sectors and portfolios due to common vulnerabilities,” Stransky reports.

“As more and more companies purchase cyber insurance, insurers are becoming increasingly concerned with aggregation risk,” suggests Ira Scharf, general manager of worldwide cyber insurance at BitSight. “We’re collaborating with AIR to help them more accurately account for cyber risk in the entire supply chain, such as security vulnerabilities on hosting companies, cloud providers, and other third-party suppliers,” Scharf points out.

“The pace of data breach activity shows no sign of slowing, despite the unprecedented focus on protecting systems and data from attack and compromise,” reports Inga Goddijn, RBS’s executive vice president. Noting that if the current rate of disclosure continues, 2015 will be the worst year on record for the number of breach events reported, Goddijn adds that “comprehensive modelling of cyber risk has never been more important.”


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