Cyber Pandemic: Modelling the Accumulation of Claims on an Insurance Portfolio

The Covid-19 crisis has led to an intensification of digital uses. This increased reliance on digital technology exacerbates the dangers of cyber attacks for individuals and businesses alike. In this context, the cyber insurance market is developing strongly, as a tool to reinforce a "cyber-resilience". Nevertheless, quantification of risk is essential for the viability of these solutions and to prevent the scope of coverage from being too narrow. One of the sector's fears is the risk of accumulation: in the event of a massive cyber-epidemic, the principle of pooling is undermined, leading to considerable losses. In this risk assessment work, we use compartmentalized models (SIR type) to analyze the dynamics of a cyber incident, highlighting the impact of the behavior of the players (insurers and policyholders) on crisis management and its consequences.

A recorded websession by the Institut des Actuaires. (In French language)