It will commit up to US$1b in capacity to provide cybercoverage.
Singapore is forming the world’s first commercial cyber risk pool in an effort to strengthen the region’s resilience in the face of increasingly sophisticated cyberattacks, finance minister Heng Swee Keat said at the 15th Singapore International Reinsurance Conference.
“The pool will commit up to US$1b in capacity, and bring together both traditional insurance and insurance-linked securities markets to provide bespoke cyber coverage," he said.
Asia is at the center of malicious cyberactivity with Heng noting that hackers are 80% more likely to prey on organisations in Asia. However, corporates in the region take 1.7 times longer than the global average to discover cyber breaches and more than 60% of companies do not have proper cyberthreat monitoring systems in place.
“On the insurance front, insurance coverage of cyber risks remains very low globally, due to a lack of historical data and intelligence to support risk assessment, underwriting and pricing. As a result, most policies have too many exclusions,” lamented Heng.
“The cyber risk pool reflects Singapore’s standing as a specialty insurance hub, and our commitment to driving forward-looking insurance solutions to tackle new and emerging risks,” Heng added, as he called on industry players to participate in the joint effort.
So far, twenty insurance firms have expressed interest to participate in the pool which would beef up the protection of corporates in ASEAN and Asia against cyber-related losses.
Heng also announced the setting up of the Global-Asia Insurance Partnership centre for excellence which aims to gather insurance players, regulators and academics. The platform aims to be a living lab developing cybersolutions, regulatory think tank and talent development pillar.
The move comes on the heels of the establishment of the ASEAN-Singapore Cybersecurity Centre of Excellence in August which will build up the cyber strategy development, legislation, research capabilities of ASEAN member states.
The initiative was launched in collaboration with the Singapore Reinsurers’ Association and cyber specialist Peter Hacker.
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