Cyber terrorism will be on the agenda of the government terrorism reinsurance agency, the Australian Reinsurance Pool Corporation (ARPC), as part of its tri-annual review.
Dr Chris Wallace, CEO of ARPC, told The Australian that the next review, due in late 2018, should consider extending coverage to cyber terrorism.
“We’ve been talking in the market about cyber terrorism. It’s something that’s not currently covered by the scheme,” Dr Wallace said.
ARPC, the statutory government body dealing with terrorism-related insurance claims and protection, says cyber terrorism is the biggest black hole in the insurer’s framework, and it is an increasing threat.
The ARPC, which acts as a reinsurer after incidents are officially declared a terrorist event by the Federal Treasurer, only recently extended the scheme to cover high-rise, high-value residential buildings worth more than A$50 million (US$38 million). That was an area of the insurance market where there was little or no insurance cover available.
ARPC provides back-up insurance coverage for 220 insurance companies around the world that cover major commercial and infrastructure assets in Australia. The companies must have deductibles of between A$100,000 and A$10 million per insurance contract before they can turn to the ARPC for back-up insurance for claims above these levels if an event is declared a terrorist event under the legislation.