On Monday, tens of thousands of shipping containers remained stuck in ports around the country following a cyber attack on stevedore DP World. Restoration of these port services, according to DP World, is likely to be days rather than weeks.
DP World operates container terminals in Sydney, Melbourne, Brisbane and Fremantle. In a comment on social media, Claire O’Neil, the home affairs minister, said the firm handles nearly 40% of the goods coming in and out of Australia. The Dubai headquartered company disconnected from the internet on Friday to contain damage.
The federal government, including Air Marshal Darren Goldie, the national cyber security coordinator, is providing DP World with technical and communications advice around the attack.
Before the incident, Insurance Business spoke with Ben Robinson, professional risk placement manager with Honan Insurance Group. Robinson is a cyber insurance specialist.
Robinson’s responses to questions suggest that DP World’s insurance program will be a key factor in its capacity to fully recover from this cyber attack.
“Cyber Insurance not only provides access to capital in times of crisis, but also connects businesses with an ecosystem of top-tier vendors necessary when responding to a breach,” he said. “This is invaluable when a timely response is crucial to meet regulatory requirements, while minimising financial and reputational damage.”
The importance of DP World to supply chains and the economy likely explains why the government is also taking such an active advisory role in this attack.
“DP World have been working with government to try to resolve this and in ways that will make sure that this doesn’t impact as much as possible on Australians,” said Home Affairs Minister Clare O’Neil.
Robinson described a wide array of experts that a firm like DP World is likely consulting through its insurance program as a result of this attack.
“This network of experts includes ransom negotiators, forensic IT specialists, forensic accounting specialists and regulatory advisors,” he said. “It is too expensive for any business to engage these advisors in a permanent and ongoing capacity, so an efficient way to obtain the right advice in a timely manner in the event of a breach is through the right cyber insurance program.”
Despite these ongoing major attacks, over the last year, the cyber insurance market and premiums have stabilised.
“Conditions in the cyber reinsurance market specifically have relented this year, with pricing stabilising after a period of significant hardening,” Robinson said.
He said particularly during the last quarter, the “dynamics” of cyber insurance has experienced “significant changes.”
“There was an initial period of disruption characterised by a deteriorating loss environment, limited insurance capacity, increased global demand, and a major pricing correction,” Robinson said.
He said the market conditions are now stabilising due to improved underwriting results.
“Pricing has either levelled off or decreased in Australia and other regions globally, limits are increasing, and competitive forces are leading to more customised underwriting decisions that align with companies' risk profiles,” Robinson said.
He attributed the turnaround to improved cybersecurity measures and the initial impact of the Ukraine conflict, which decreased ransomware activity, although he said that trend is now reversing.
“Risk transfer has played a crucial role in promoting stronger risk controls, thanks to insurers' strategies for deploying their capacity,” Robinson said. “By 2030, a substantial boost in supply is needed to meet the escalating demand, despite notable advancements.”
Meanwhile, DP World continues to deal with the fallout from this latest incident.
In a statement quoted by ABC News, the firm said it “has worked tirelessly, making significant progress in re-establishing landside freight operations at its ports."
DP World said it is investigating if personal information “has been impacted and has taken proactive steps to engage the Office of the Australian Information Commissioner."
The statement said teams were "testing key systems crucial for the resumption of normal operations and regular freight movement" and it would provide a further update once testing was complete.
Insurance Business has reached out to insurance firms in the transport and logistics space for comment on the possible impacts and significance of this cyber attack.
Are you an insurance or risk adviser in the transport and logistics space? How do you see the significance of the attack on DP World?
