Monte Carlo methods to investigate how aggregated cyber insurance claims data impacts security investments

Daniel W. Woods, Andrew Simpson

Research output: Contribution to conferencePaperpeer-review

Abstract / Description of output

There is evidence that the availability of cyber insurance is contingent on an applicant’s security posture and that premium discounts may apply if the applicant adopts security controls dictated by the insurer. As the cyber insurance market grows in size, questions arise regarding how this situation will affect investment in information security. We investigate how aggregated claims data impacts investments in information security. Monte Carlo methods are used to explore three possible insurer strategies in guiding the policyholder’s investments. The results suggest that aggregated claims data can increase the net revenue of all firms, particularly in cases of low security investment or high uncertainty, but these benefits are contingent on the insureds employing diverse defensive configurations.
Original languageEnglish
Number of pages24
Publication statusPublished - 17 Jun 2018
EventThe 17th Annual Workshop on the Economics of Information Security (WEIS 2018) - Innsbruck, Austria
Duration: 18 Jun 201819 Jun 2018
Conference number: 17
https://weis2018.econinfosec.org/

Workshop

WorkshopThe 17th Annual Workshop on the Economics of Information Security (WEIS 2018)
Abbreviated titleWEIS 2018
Country/TerritoryAustria
CityInnsbruck
Period18/06/1819/06/18
Internet address

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