A new report on digital risks has been published by the Lloyd’s Emerging Risks Team.  The report was made available in the event packs distributed at the recent joint event between Lloyd’s 360 Insight and NATO on three important risks facing society, namely climate change, digital security and piracy.

In Lord Levene’s address to the conference he cited the report adding “Now if your business stores its IT files in Asia or the Gulf of Mexico, and a flood or storm strikes, your systems could fail in London. Suddenly, the wet and windy South of England is exposed, through a computer connection, to a natural catastrophe.”  Indeed, Jaak Aaviksoo, Minister of Defence for Estonia went on to highlight his country experiences when they suffered a nation-wide cyber attack in 2007 over a dispute with Russia over the moving of a war memorial.

The digital risks report itself focuses on some of the trends and emerging risks posed by the revolution in digital and communications technology with the aim of raising the profile of these risks within the insurance industry and amongst risk managers in affected businesses.  Key topic areas included:

• the rise in the number and sophistication of cyber crime attacks;
• highlighting the legal and liability issues surrounding internet or ‘cloud’ computing;
• the risks and opportunities of ‘Web 2.0′ and the unprecedented level of sharing of information that the internet makes possible;
• raising the potential risks due to the increasing trend of using Global Positioning System or GPS within industry and transport; and
• reiterating the fact that this new virtual world is still grounded in the physical world and that natural or man-made disasters could have significant impacts on the digital economy.

Beyond those reports referred to in our report, there are several others that highlight other facets of this interesting and increasingly pertinent risk topic, including several strategy reports that summarise the current infrastructure and threats.  Insurers with cyber-liability and other digital risk exposures will find the following reports worth reading:

• Council of Science and Technology’s report on “A National Infrastructure for the 21st Century“
• The Technology Strategy Board’s (TSB) Network Security Innovation Platform (NSIP) recently published their interim strategic assessment  focusing on the challenges information risk poses to the UK.

Tags: Digital risks, digital risks report, Emerging risks

This entry was posted by David Baxter on Tuesday, October 6th, 2009 at 8:55 am and is filed under Exposure Management.