Credentials stolen via phishing remains the most common cyber attack vector for businesses

Ransomware will continue to dominate the cyber security landscape while cyber war endorsements prompt further innovation, according to DAC Beachcroft’s top technology predictions for 2023.

The law firm noted that ransomware attacks are becoming “increasingly sophisticated” as cyber criminals have evolved their methods – and for this reason these attacks will continue to dominate the cyber-security landscape this year.

For example, credentials being stolen via phishing remains the most common cyber attack vector for businesses and government organisations.

Meanwhile, the shift to hybrid working has also heightened the use of deep fake technology – a form of image, audio and video hoaxing created through artificial intelligence.

This is why the threat landscape requires a multi-layered solution that combines anti-malware, data loss prevention, email security, endpoint detection response, vulnerability assessment, patch management, remote monitoring and backup capabilities.

Staff training and public education also have key roles to play, added the report.

Cyber war endorsements like buses

In terms of cyber war endorsements, the law firm believes that these will spur innovation.

The report stated: “Cyber war endorsements are like buses – after a prolonged absence of new clauses, there are now several different options available to cyber underwriters.”

DAC Beachcroft noted that these include the Lloyd’s Market Association (LMA) clauses – LMA5563-5567 – introduced in November 2021. This relates to exclusion number four on war, cyber war and limited cyber operation. 

The LMA5563-5567 clause states:

”Notwithstanding any provision to the contrary in this insurance, this insurance does not cover any loss, damage, liability, cost or expense of any kind (together “loss”) directly or indirectly occasioned by, happening through or in consequence of:

1.1. War or a cyber operation that is carried out in the course of war; and/or

1.2. Retaliatory cyber operations between any specified states leading to two or more specified states becoming impacted states; and/or

1.3. A cyber operation that has a major detrimental impact on:

  • 1.3.1. The functioning of a state due to the direct or indirect effect of the cyber operation on the availability, integrity or delivery of an essential service in that state; and/or
  • 1.3.2. The security or defence of a state.”

Other cyber endorsements include the Marsh and Munich Re clause introduced in Spring 2022, plus a range of bespoke responses from insurers in cyber.

“The LMA group has reconvened to review this further. This has been brought into focus by the conflict between Russia and Ukraine and associated events such as the Viasat satellite attack and damage to the Nord Stream pipeline,” the report added.

“Finding solutions that limit exposure to systemic risks but do not impede commercially attractive solutions for the market is challenging. While we appreciate the need for consistency across towers and back to back provisions with reinsurers, further innovation is welcome in identifying acceptable solutions.”