This spotlight delivers an overview of the latest cyber risks impacting the sector generally, including recent incidents and emerging threat vectors. We also highlight our insurance solutions that can address the cyber vulnerabilities faced by the marine industry. Use our insights to enhance your organisation’s cyber risk management approach.
What cyber incidents have we seen from the marine industry?
The increasing frequency of these incidents underscores the escalating cyber risks within the marine sector. A thorough understanding of the scope and ramifications of these events are instrumental in refining your organisation’s cyber risk management framework.
On July 19, cybersecurity company CrowdStrike released a software update for Falcon Sensor, their vulnerability scanner designed to detect system intrusions and hacking attempts. Unfortunately, this update contained flaws that disrupted approximately 8.5 million computers worldwide running the Windows operating system. The marine industry's reliance on digital systems for navigation, cargo management, and communication makes it particularly vulnerable to cyberattacks and systemic disruptions. A breach could potentially disrupt global trade routes, port operations, and vessel navigation, leading to significant operational delays, financial losses, and safety risks.
Read more hereA coordinated cyber-attack in April 2024 targeted several key maritime ports and vessels causing a widespread disruption. The incident was ransomware based where malicious software was used to target critical systems and[SL1] exploit vulnerabilities in the Automatic Identification Systems (AIS) onboard ships. Shipowners experienced serve delays due to misrouted cargo and the increased risk of collisions.
Read more hereAustralia’s largest port operator suffered a cyber-attack where the threat actor was able to gain unauthorised access to critical systems which were used to coordinate shipping activity.
Read more hereCyber Security Awareness Month: A smarter way to combat cyber risk
October marks Cyber Security Awareness Month, and there's no better time to ensure your organisation is secure and resilient.
Contacts
Cyber insurance claims we have seen from the marine industry
Below is a selection of recent anonymised claims managed by WTW.
Malicious data breach
A phishing attack on a company's network exposed confidential information. The suspected cause of the event was employees clicking on rogue links.
Ransomware attack
A third party gained access to a company's network, encrypting and exfiltrating data. Cyber insurers indemnified the costs incurred by the company.
Payroll data breach
The company’s server, which hosts payroll data was accessed by criminals. The data was published on the internet for an unspecified period.
Ship computer systems hacked
The company was able to access specialists under its cyber policy. The affected exchange server was rebuilt.
Accidental data breach
The company discovered faulty programming in its network allowing users without authority to access the details of other clients.
Related content
Our perspective on cyber market trends for the marine industry
- GPS Interference and AIS Spoofing: Shipowners have a dependency of GPS to navigate voyages efficiently and safely. The U.S Coast Guard Navigation Center data shows an increase in GPS Interference, which can lead to significant consequences such as collisions and severe delays due to misrouted cargo.
- Increased autonomy in the maritime sector raises cyber risk: The move by shipowners and operators of ports and terminals towards greater reliance on IT and OT to fulfil key aspects of their operation can undoubtedly deliver vital efficiency gains. At the same time, however, this leaves such operations more exposed to malicious cyber activity aimed at disrupting such operations for both financial and political purposes. (The Maritime Executive, Jessie Hamill-Stewart and Andrew Sallay, 2023).
- Legislation to force change on maritime sectors’ approach to cyber security: The NIS 2 Directive must be implemented by European Union (EU) member states by 17 October 2024. The Directive aims to achieve a common level of cybersecurity across the EU, imposing stricter cyber-security requirements with regard to risk management, incident reporting and the exchange of information. It comes in response to the escalating threats brought on by digital transformation and the rise in cyber-attacks, and replaces the Network and Information Security (NIS) Directive of 2016, which will be repealed with effect from 18 October 2024.
WTW insight:
The cyber insurance market has traditionally had a restricted appetite towards risks within the marine industry due to:
Throughout 2024, we have continuously seen enhanced buying conditions for all industries in the cyber insurance market; however, most notably for the marine sector, we have seen a welcomed increase in appetite and capacity from cyber insurers, which has historically been dominated by a select few of our CyNav partners. This has created a competitive environment for Shipowners and Ports and terminals purchasing cyber insurance, where premium reductions, increased capacity, lower self-insured retentions and coverage enhancements have been obtained.
We expect market conditions to stabilise for Q4 2024 and into 2025, whilst insurers interest for marine risks to continue to increase. There is a possibility that insurers reassess their appetite for coverages such as system failure following the Microsoft/CrowdStrike event in July 2024.
How WTW can help with identifying, assessing, and protecting your business
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