“…the aviation market needs to sit up and take notice of cyber risks. ”
The aviation insurance industry should pay closer attention to potential cyber risks to avoid being caught out by claims, cyber brokers have said.
Speaking to The Insurance Insider, Christian Davies, technology, media and cyber broker at Lloyd’s broker Safeonline, said that the aviation market needed “to sit up and take notice” of cyber risks.
“The point is that the aviation industry is going to have to be prepared for it, because the cyber market isn’t going to cover the resulting property damage and liabilities should a plane be ‘hacked’ out of the sky,” Davies said.
“Some of the newer planes, such as the technically-advanced Boeing models, are flown with the help of advanced computer systems, with the pilot ceding some aspects of control,” he explained.
“If you look at the back of business class, first class and sometimes premium economy seats, some now have USB ports where you can connect a mobile device.”
Davies noted that given the increased connectivity on aeroplanes, anyone with access to a USB port and malicious software now had the ability to cause damage.
“The aviation market has the capacity to cover this kind of risk, but it doesn’t have the expertise. So they need to work with the cyber guys to ensure they stay one step ahead,” he added.
Speaking at a Willis aviation insurance conference in Hong Kong last week (4 March), Peter Armstrong, head of cyber strategy for Willis Group, said that the aviation sector was particularly exposed to aggregated cyber risk because it relied heavily on digital capability.
“While we believe this is predominantly a risk management issue, the insurance industry has a role to play and must ensure that it has the appropriate solutions on offer not only to help companies deal with the financial fallout from cyber breaches, but also to recognise the significant impact cyber has on existing categories of risk and respond with appropriate risk transfer solutions,” he said.
Armstrong added that the recent launch of a cyber security framework from the American Institute of Aeronautics and Astronautics had been a good start.
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