Cyber Insurance’s Battle With Cyberwarfare

Cyber war is at our digital doorsteps—and if some observers are to be believed, has crossed the threshold and entered our daily existence. While it’s certainly true that nation-states across the world now approach cyberspace as another operational domain, what actually constitutes a declaration of war in this dimension is the subject of heated debate.

The question hinges on a wide array of philosophical, semantic, and legal questions, most of which are unlikely to be definitively resolved in the near future. But the implications are more practical and immediate.

Whether or not a given attack that affects private industry is classified as cyber war can have substantial impacts on whether the fallout is covered by a cyber insurance policy.

President Barack Obama, for example, referred to a destructive 2014 ransomware and doxing cyber attack on Sony Pictures Entertainment that cost an estimated $35 million officially as an act of ‘cybervandalism.’

However, the incident was officially attributed to attackers sponsored by the North Korean government, the Obama administration issued new sanctions against North Korea, and Senator John McCain called it a ‘new form of warfare.’