As the transformational impact of Generative Artificial Intelligence (GenAI) technology on the cyber landscape is expected to increase the frequency, severity, and diversity of attacks with prospects for more threats to assets, Lloyd’s has urged insurance industry players on the urgent need to take proactive steps to mitigate the risks of the technology on the global economy.
A new report from Lloyd’s, the world’s oldest insurance and reinsurance firm, critically appraises how the rapid evolution of GenAI is reshaping the cyber landscape and what businesses need to do to bolster their resilience to the ever-changing threats.
The report showed that the sophistication of AI, and notably unrestricted advanced GenAI models, had significantly increased in recent times, and Lloyd’s experts noted that the trend would reshape the cyber risk landscape as it augments threat actors and defensive capabilities.
Despite these recent advancements, Lloyd’s reported that so far, material impacts on the cyber threat landscape remained minimal, partly due to safety mechanisms and effectiveness of AI model governance as well as cost and hardware barriers which had prevented widespread misuse by threat actors.
However, the firm expressed concerns that as these tools become more and more accessible, they will pose an increasing risk as threat actors could have more opportunities to leverage the tools in malicious ways.
Specifically, Lloyd’s projected that the impact of GenAI on the cyber landscape was likely to increase the frequency, severity, and diversity of smaller scale cyber attacks, and believes the attacks will grow over the next two years, followed by “a plateauing as security and defensive technologies catch up to counterbalance their impacts.”
Cyber insurance is one of the fastest growing segments of the insurance industry, and Lloyd’s highlights the important role it plays in helping businesses and society both understand and manage the threat.
In addition, it underscores the importance of businesses and the insurance industry taking proactive steps to manage the potential changes to the cyber threat landscape from GenAI technology.
Commenting on the report’s findings, Lloyd’s Director of Portfolio Risk Management, Dr Kirsten Mitchell-Wallace, said: “Lloyd’s has been exploring the complex and varied risks associated with AI since 2016 and its developments present both opportunities and risks for businesses and the insurance industry.
“When considering the threat landscape, we must stay responsive to these rapidly changing technologies, learn from them, and seek to make the most of the efficiencies they bring. Generative AI is not the first, and won’t be the last, disruptive technology to impact the cyber threat landscape, so it is critical that business improve their risk mitigation, security and defence technologies, as well as seek appropriate risk transfer today, more than ever before,” she added.
