Expert: cyber attacks could have same financial clout as hurricane

One of the world’s leading cyber security experts has claimed that the economic damage of a major cyber-attack against a large cloud services provider could match that wrought by a destructive hurricane.

Comments made by John Drzik, president of global risk and digital at Marsh, a risk management and insurance broking firm, suggest that even the $108 billion (£77.8 billion) worth of damage caused by tropical cyclone Katrina in the US in 2005 could be exceeded by one major cyber-attack.

Speaking at the launch of the World Economic Forum (WEF)’s Global Risks Report 2018, Drzik said: "To compare the degree of economic cost, estimates now are that if attackers took down a major cloud provider, the damages could be $50 billion to $120 billion, so something in the range of a Sandy event to a Katrina event.”

In WEF’s latest risk report, the international body has rated cyber-attacks as a top three risk to society in today’s climate, along with natural disasters and extreme weather.

Despite 2017 being a record year in terms of the damage caused by extreme weather events and natural disasters, cyber-attacks have already wrought more financial mayhem around the world.

Dzrik suggests that the total aggregated cost of cyber crimes, such as the WannaCry attack and similar large-scale hacks, is now estimated at over $1 trillion per year, versus just $300 billion lost thanks to natural catastrophes.

He also warned that governments and supporting agencies are acutely unprepared to deal with major cyber-attacks, particularly when compared to global response plans for natural disasters.

"Think about the comparative scale," said Drzik. "Think about the government agencies as well as voluntary organisations which focus on response to natural disasters, verses national cyber-agencies - they're much less resourced. They have some capacity, but not enough to deal with what is a significantly growing risk."