Insurers Urged to Stress Test Cyber Portfolios for Russian Attack Potential

March 7, 2022 by Chad Hemenway

Cyber risk and analytics firm CyberCube said it has seen cyber attacks on Ukrainian government services, infrastructure and other industries and it urges the insurance industry to re-evaluate exposures.

Russia’s invasion of Ukraine “will undoubtedly push the boundaries of acceptable behavior in cyberspace,” said William Altman, CyberCube’s principal cybersecurity consultant, in a statement.

“What’s worrying is that the cyber elements of this conflict could escalate quickly,” Altman continued. “We have the potential for unprecedented cyber-physical impacts, including attacks on critical infrastructure.”

The firm said in a new report, “War in Ukraine creates fundamental shift in the cyber threat landscape,” that it recommends insurers and reinsurers—especially those with books of business in Eastern Europe—to stress test portfolios because, as the conflict progresses, potential cyber attack scenarios become more serious.

These include, according to CyberCube, attacks on offshore oil rigs, utilities, mobile phone networks, hospitals, airlines, the banking system and widespread use of wiper malware intended to erase data from the hard drives it infects.

CyberCube said attacks such as wiper malware, denial-of-service attacks and misinformation campaigns are already happening to Ukraine and Russia, with some spillover into neighboring countries. Companies in the U.S., UK, Japan and European Union, which have imposed sanctions on Russia, are at risk of retaliatory cyber attacks, CyberCube said.

“The risk of a cyber disaster impacting (re)insurers’ portfolios is higher as a result of Russia’s intent, opportunity and capability to compromise [single-point-of-failure] targets that give them widespread and unfettered access to critical computer networks and data,” added Darren Thomson, head of cybersecurity strategy at CyberCube. “Hacktivist coalitions and cyber criminals are taking sides, with prolific groups pledging services to aid the Russian government’s war machine.”

Ukraine and Russia have each “openly recruited a global volunteer cyber force” to help attack each other’s networks and IT systems. CyberCube counts 22 cyber threat-actor groups assisting Ukraine and nine doing the same for Russia.