The damage of a "digital blackouts" after a major international cyber-attack could only be handled with state aid, according to reinsurer Munich Re. CEO Joachim Wenning called for public-private partnerships between governments and insurers at the company’s digital shareholder meeting Wednesday to help manage the financial fallout from both pandemics and cybercrimes. According to Wenning’s argumentation, the insurance companies alone were financially overburdened with both.
Digital blackout comparable to a pandemic
"A pandemic is not insurable in its entirety", Wenning said of the economic damage caused by the Corona crisis, which alone cost the Munich-based company nearly 3.5 billion euros in 2020. A global hacker attack would also be very expensive, according to Wenning: "A targeted virus can infect computer systems worldwide within a very short time and cause threatening economic damage", said Munich Re’s CEO. "Such a "digital blackout"-Scenario would be just as uninsurable in the private sector as a pandemic."
Munich Re and other insurers proposed last year that governments and companies share pandemic risks in the future. Insurers were able to provide a minimum level of protection against pandemic risks up to a certain amount of money. If that is not enough, the state could intervene. This year, Corona will cost Munich Re another 600 million euros, according to the Board of Management’s forecast. However, Wenning reiterated the goal of increasing earnings and dividends per share by an average of at least 5 percent per year through 2025.