How can you incorporate cyber threats into your risk assessment models?

One simple way to gauge your cyber security controls, is through insurance. When applying for cyber insurance consider the application questions. How many are you non compliant with? Is MFA enabled? Do you have encrypted backups? Do you have endpoint detection? The less you have implemented the more at risk you are. So you can kind of use the insurance applications as a guide. Most carriers can also perform vulnerability scans which can further identify more technical vulnerabilities.

Said more simply, identify the most important digital assets to your organization (include things like consumer data, personal and financial information, intellectual property, and other non-public business information).

Weak passwords. Weak passwords are easily cracked, giving attackers access to accounts and systems. Organizations should require employees to use strong passwords and enable multi-factor authentication for all critical accounts.

Our investee cyber insurance startup in the US has enhanced portfolio performance and risk aggregation by incorporating active surface attack scanning and monitoring in its underwriting and ongoing threat audits, including quarterly client risk assessments. With the rise in connected devices, the focus has shifted from breach occurrence to response readiness. The assessment tool, utilizing Open Source Intelligence for dark web data and leaked credentials, aids in comprehending a firm's cybersecurity posture, and aiding in better incident management. We are observing a higher adoption by insurance companies with the approach when underwriting cyber insurance for corporates.

Cyber threats are the new frontier of risk, and incorporating them is crucial. The challenge lies in the nature of cyber threats. The solution? Continuous learning. Update risk models in real time, leveraging AI and machine learning to stay ahead. The outcome is a resilient assessment model that adapts to emerging threats, safeguarding clients while staying at the forefront of the cyber defense game.

In modelling and pricing cyber insurance amid rising incidents, we collaborate with cyber risk scorers, security firms, regulators, and customers for transparency, reducing intelligence and threat asymmetry. Real-time data and machine learning help identify evolving patterns, while external datasets provide insights into emerging threats. Collaborative sharing, scenario analysis, and stress testing deepen risk understanding. Engaging the cybersecurity ecosystem for realistic incident-response scenario development and adopting adaptive approaches reflecting the current risk landscape is vital.

In other words, identify those cyber threats that could impact the digital assets set forth above (include technical threats like malware as well as more human weakness-based risks like social engineering).

Said differently, assess the potential impact and likelihood of each identified threat. Include your evaluation of how likely it is that each threat may occur and the likely impact on your organization if there was an occurrence

In loss quantification, I've sat in on cyber insurance negotiations between reinsurers and clients. A holistic assessment of 1st and 3rd party implications, for and against the insured, is crucial, requiring a collaborative approach as ramifications extend beyond direct business impacts foreseen by project or IT managers. Input from general counsels, and risk and compliance officers, on larger regulatory and compliance impacts is invaluable, enriching the understanding and mitigation of cyber risks.

Develop strategies and tactics to reduce the likelihood and potential impact of cyber threats. Include for example security controls that have been implemented, employee training on best practices, and the establishment of incident response planning.

Be sure to prioritize and sequence your cyber security efforts. Not all threats apply to every organization. Some threats are more likely to occur than others. Others could have a more deleterious affect on your organization than others. Sequence and prioritize your efforts based on the likelihood and potential impact of each threat identified.

I believe the industry needs to develop a well-rounded cyber solution that includes creating risk awareness, preventing risks, monitoring risks, mitigating risks, and finally transferring risks. The defense of a system is as strong as its weakest link. Considering we've all left some digital traces on the World Wide Web since its creation in 1983, it's not about if but when an organization or individual will face a cyber attack. Therefore, the focus should shift from just preventing attacks to having strong incident response, recovery, and mitigation plans in place.