Cyber Security Risk Management on the Federal and Private Sector Level

Taxpayers bailed out the banks following the 2008 financial crisis and could be on the hook once again as the cyber security landscape changes each day and becomes more and more frequent, explains Mike Nelson, Chairman and Managing Partner of Nelson Brown. Right now the government is not covering much of the cost, but if it ever became a cyber terrorism event, losses on that scale would likely result in the government stepping in to prevent total financial disaster. The Terrorism Risk Insurance Act (TRIA) was put into place after 9/11 to allow the government to provide financial support for insurance companies after terrorist attacks. Even if cyber terrorism insurance was distributed through the private sector, estimating potential damage is still near impossible. Nelson quantifies some of the cost and the risk that insurers could be asked to take on. Jill Malandrino reports from the Nasdaq MarketSite in New York.