Cyber Threats Main Concern for Insurance Decision Makers: AIG Survey

A survey of perceptions about cyber risk sponsored by the American International Group, Inc. (AIG) found that among corporate executives, more are concerned about cyber threats than about other major business risks.

More than 85 percent of the 258 decision-makers surveyed said they were very or somewhat concerned about cyber risks to their organizations, compared with the group’s response to six other areas of risk, including income loss (82 percent of executives were very or somewhat concerned), property damage (80 percent), and securities and investment risk (76 percent).

Additional survey results, which include input from insurance brokers, found high demand among executives and brokers for information about cyber threats, with 80 percent indicating that they find it difficult to keep pace because the cyber threat is evolving so rapidly. This prompted AIG to develop a mobile app for cyber risk management and to introduce other tools to further strengthen its CyberEdge risk management solution.

Other findings of note include:

More than two out of three (69 percent) executives and brokers believe that the reputational risk from a cyber attack is far greater to a company than the financial risk.

More than seven in ten (75 percent) executives and brokers say legal compliance issues are making companies think more about cyber risks.

The vast majority of brokers and executives (82 percent) believe hackers are the primary source of cyber threats, though a significant portion of those surveyed (71 percent) also perceive human error as a significant component of cyber risk.

“These new survey findings confirm that business leaders view cyber risk as a top business concern, with great potential for reputational and financial loss. At AIG, the first company to introduce cyber insurance in 1999, we are working to address these concerns and provide a valuable additional layer of support through our comprehensive risk management solution for cyber insurance,” said John Gambale, Head of Professional Liability and Lexington Financial Lines Executive, U.S./Canada Financial Lines, AIG.

About the Survey

On behalf of AIG, Penn Schoen Berland (PSB) conducted the survey of 323 risk managers, IT decision makers, C-suite executives, and brokers in the United States and Canada who play a role in selling insurance policies or determining insurance programs within their organizations. The survey includes a mix of AIG customers and other companies, including 60 companies with revenue between $1 billion and $10 billion, mid-market businesses with revenue between $10 million and $1 billion, as well as large and mid-sized broker partners. These interviews took place October through November 2012. Overall, margin of error is +/-5.45% and larger for sub-audiences.

Source: AIG