Swiss Re AG's CEO called on the world's governments to work at providing a backstop for insurance losses from cyber attacks, the Financial Times reported Dec. 28.
Christian Mumenthaler told the FT in an interview that governments need to provide such a backstop as they do with terror attacks, but that they are currently disinclined to do so. Insurers, meanwhile, are concerned about the potential for accumulation risk when it comes to cyber attacks, i.e. the prospect that huge payouts could be necessitated were numerous clients to fall victim to an attack at the same time.
"You need diversification," Mumenthaler said. "If you have accumulation ... one of the principles of insurability is actually put out of play."
As a result, he said Swiss Re had been cautious in its approach to cyber insurance, taking the view that "we don't want to be overweight in this risk field. We want to be underweight."