Global insured losses from last week’s massive IT outage are likely to range from US$400 million to US$1.5 billion ($612 million to $2.3 billion), cyber analytics firm CyberCube said.
A software bug in cyber security firm CrowdStrike’s quality-control system caused the software update that crashed computers globally, the US firm said this week, as losses mount following disruption to services from aviation to banking.
The outage may be the single largest cyber insurance loss, CyberCube said in a statement.
It was “a major event for the cyber insurance market but does not come close to the destructive potential that leading insurers are holding capital against”, CyberCube said.
Insurer Parametrix this week estimated insured losses from the outage of US$540 million to US$1.08 billion for Fortune 500 companies, excluding Microsoft, whose computer software was affected by the CrowdStrike bug.
Major cyber insurer Beazley said this week it had no plans to change its guidance on its combined ratio – a key measure of underwriting profitability – after the outage.
The global insurance and reinsurance industry is likely to avoid any major financial impact from the outage, ratings agency Fitch said.
However, reinsurance broker Guy Carpenter said that insurers may face claims on directors and officers’ and property insurance as a result of the outage, in addition to cyber insurance claims.