A View from the Top
Aon’s Cyber Solutions Chief Executive Officer of North America, Christian Hoffman, shares his views on a global challenge impacting organizations across all industries and segments: Cyber
Chief Executive Officer, Cyber Solutions Christian Hoffman
Rapid digital evolution is required of organizations to drive quality, efficiency, insights and to ultimately stay competitive. While evolution brings great opportunity, it also introduces an increased risk of business interruption, loss of confidential information, regulatory challenges and supply chain disruptions. Considering this evolution, key stakeholders within every organization must align to address cybersecurity as an enterprise risk. A top-down approach, led by the board of directors and C-suite, to position the importance of cyber maturity across an organization is imperative.
A constant reminder of the prevalence of cyber risk is the ransomware challenge, which continues to impact organizations across the globe. The frequency of ransomware events increased by nearly 500% over the last two years and costs have skyrocketed with individual publicly disclosed ransomware payments exceeding $10M USD. Recent attacks on industrial control systems and technology supply chain vendors impacting thousands of entities serve as important reminders that no company is immune.
Despite the highly public nature of ransomware and recent attacks, Aon’s 2021 Cyber Security Risk Report found that only 31% of organizations report having adequate business resilience measures in place. Most companies are also failing to address other key risks, with only 21% of organizations reporting adequate third-party management measures to oversee critical suppliers and vendors.
In an effort to combat this challenge, we are seeing a new level of collaboration between the public and private sectors. In the U.S., President Biden signed an Executive Order to modernize the nation’s cybersecurity defenses, improve information sharing between the U.S. government and private sector, and improve the government’s incident response readiness. The Biden Administration reinforced its commitment to combatting ransomware by offering rewards up to $10M USD for information leading to the identification of foreign bad-actors that have attacked U.S. infrastructure. There has also been increased collaboration internationally. The Institute of Security and Technology Ransomware Task Force, led by representatives from organizations and agencies around the world, released a framework to combat ransomware, including 48 prioritized recommendations centered around international coordination.
To help drive this alignment, Aon takes a holistic approach to Cyber by helping organizations proactively assess, test and mitigate risk as well as quantify and transfer the risk into the insurance market. If security defenses ultimately fail and an organization experiences a cyber event, Aon offers digital forensics and incident response capabilities to respond to the incident while preserving evidence and confidently communicating with stakeholders. As clients are faced with the security challenges presented and a firming Cyber insurance market, the Aon approach fosters the necessary alignment across security and risk to drive better outcomes.
I am pleased to have the opportunity to introduce this quarter’s Global Market Insights report, which provides Aon insights into local market responses to Cyber risk, as well as other important trends impacting the insurance and risk marketplace globally. This quarter’s report summarizes how, around the globe, underwriting scrutiny is high, compliance with risk control requirements is becoming a mandatory prerequisite, and coverage restrictions continue for volatile exposure types. The market remains challenging; however, as the uncertainty of 2021 subsides, and capacity from traditional and non-traditional sources continues to flow in, we are beginning to see a shift in some parts of the market toward profitable growth over remediation. On behalf of the entire Aon team, we look forward to helping you navigate the road ahead.