Governance
Aligning the financial exposures from cyber risk with the Corporate Risk Appetite Framework to better demonstrate a reasonable risk-based approach to stakeholders.
Cyber Impact Analysis
What is Cyber Impact Analysis?
Aon’s cyber impact analysis helps to evaluate an organization’s risk exposure through the financial quantification of relevant cyber scenarios. Insights from our data and analytics highlight what investments in risk management strategies may be needed — including information security, business continuity and cyber insurance. The results help an organization’s risk, security and executive leadership teams contextualize cyber risk through the lens of its potential impact on business objectives. This helps improve decision-making to safeguard shareholder equity and help protect customers, employees and the general public.
Cyber Impact Analysis: The Why and When
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9.4M
The average cost of a data breach in the U.S. is $9.44 million. (1)
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23.8T
The global cost of cybercrime is expected to increase to $23.84 trillion by 2027, up from $8.44 trillion in 2022. (2)
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49%
However, ransomware frequency increased sharply, up 49 % in Q1 2023. (3)
Digital transformation is expanding the attack surface at companies in all industries. At the same time, cyber criminals are ramping up both the volume and the sophistication of their attacks, and global losses due to their attacks are increasing exponentially. As a result, cyber risk makes up a growing proportion of an organization’s overall risk portfolio. But it has not historically enjoyed the same robust financial modeling as other enterprise risks.
Many organizations are starting to recognize this and ask more questions about the true balance sheet exposure posed by cyber risk. Unfortunately, some find that legal, security, operations and IT teams operate in silos and use different methodologies to measure cyber risk, complicating the attempt to answer questions that are becoming more urgent.
For some businesses, the need to invest in cyber risk management may be undisputed. Still, they may lack the information and advice on which strategies will do the most to reduce risk, protect the balance sheet and demonstrate appropriate risk governance to regulators and investors. Answering these questions requires analysis of how relevant cyber scenarios could impact an organization’s unique business and technology profile, what measures are in place to mitigate operational or financial impacts and what financial exposure should be considered for risk transfer.
How Aon Can Help
Aon serves as a trusted advisor to all stakeholders involved in protecting an organization from cyber risk. Unlike other providers, Aon has the broad experience to establish strong collaboration across risk, commercial, legal and information security teams — as well as the Board of Directors and the C-suite. Cyber impact analysis from Aon helps organizations treat cyber risk with the same sophistication as other enterprise risks by providing data-driven analysis based on relevant cyber scenarios
This approach can inform these corporate risk management functions:
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Cyber security and business continuity
Coordinating the roadmap and investment strategy for the cyber risks that could cause the most material financial loss — and better articulating the ROI of these investments.
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Risk transfer
Stress testing current cyber insurance limits and retentions to help address the complexity and materiality of cyber exposures to optimize the Total Cost of Risk.
Our team is:
- Highly qualified. Cyber Impact Analysis engagements from Aon are provided by a dedicated global team of more than 50 consultants. The combined team has expertise and certifications in data and actuarial science, forensic accounting, cyber security, risk financing and business continuity management. Other firms that offer similar services often use generalists whose experience is less broad and deep.
- Extensively experienced. The Aon team has delivered more than 1,500 cyber impact analysis engagements for Forbes Global 2000 clients across all regions of the world. As a result, we have experience and insights from every industry segment and geography.
- Skilled in data and analytics. Quantification of risk is only as good as the data that underlies it, and some vendors that purport to offer such analysis do not have a specific data set on which to base their calculations. Aon uses aggregated insights found in its global Cyber Data and Analytics Platform, which includes scenarios and loss data from more than 1,500 analysis projects and more than 50,000 incidents and claims.
The Aon Team
Our cyber impact analyses are delivered by a global team of highly qualified professionals with decades of experience across all areas of cyber security, as well as disciplines like law enforcement, accounting, law, risk management, business resilience, disaster recovery, crisis management, insurance and more. The combined team holds certifications as actuaries (including FCAS, CERA and ASA), forensic accountants (CFE and others) and business continuity professionals (MBCI and others). Consultants on the team also hold numerous cyber security certifications.
(1) Source: Cost of a data breach 2022
(2) Source: Cybercrime Expected To Skyrocket in Coming Years
(3) Source: Buyer-Friendly Cyber and E&O Market: How to Take Advantage
