Biblio

Cyber risk is continually evolving, meaning insurers should understand emerging risks in order to keep pace with their clients' exposures. Lloyd’s, CyberCube and Guy Carpenter have conducted an analysis detailing three scenarios which represent the most plausible routes by which a cyber attack against industrial control systems (ICS) could generate major insured losses. All three scenarios have historical precedents. The report describes how more severe events could unfold. This report considers four key industries dependent upon ICS (Manufacturing, Shipping, Energy and Transportation) and assesses precedents and the potential impact on each. The potential for physical perils represents a major turning point for the broader cyber (re)insurance ecosystem. This risk has previously been considered unlikely to materially impact the market, with cyber perils traditionally emerging in the form of non-physical losses. However, crossing the divide between information technology (IT) and operational technology (OT), along with increases in automation and the sophistication of threat actors, means it is paramount that (re)insurers carefully consider how major losses may occur and the potential impacts.

The manufacturing and production industry must address physical, human, and cyber threats in order to secure their supply chains. Physical threats include climate change/natural disasters that may reduce the supply of raw materials and disrupt production of final products. Facility flaws – “guards and gates” – also present a physical threat that may allow penetration points at manufacturing sites. Malicious human actions (e.g., crime, sabotage, and terrorism) and non-malicious human actions (e.g., accidents and negligence) also threaten “just in time” manufacturing schedules. Finally, cyber threats including ransomware attacks, software supply chain exploits a means by which threat actors may compromise industrial control systems as well as corporate networks and information systems bringing production to a standstill.

Information Technology has increasingly been incorporated into every segment of the economy. In manufacturing, the basic technology of Direct Digital Manufacturing (DDM) been around for dozens of years. This involves the creation of a physical object from a digital design using computer-controlled processes with little to no human intervention. With the popularization and advancement of Additive Manufacturing (AM) and 3D printing, it is becoming much more common. These technologies have the potential to significantly change traditional manufacturing and supply chain industries, including information and communications technologies (ICT). During the symposium, speakers and attendees discussed DDM cybersecurity risks, challenges, solutions, and implications for ICT supply chain risk management.