Actualization of cyber insurance under degetalization of the economy

Sholoiko Antonina
Doctor of Economics, Associate Professor, Associate Professor of the Department of Insurance, Banking and Risk-management, Taras Shevchenko National University of Kyiv, Kyiv, E-mail:sholoiko@ukr.net, ORCID ID: https://orcid.org/0000-0003-1239-4281

Cite this article:

Sholoiko A. (2023) Actualization of cyber insurance under degetalization of the economy. Ed.: V.V. Kovalenko (ed.-in-ch.) and others [Aktualizatsiia kiberstrakhuvannia v umovakh tsyfrovizatsii ekonomiky; za red.: V.V. Kovalenko (gol. red.)], Scientific Bulletin of the Odessa National Economic University (ISSN 2313-4569), Odessa National Economics University, Odessa, No. 9 (310), pp. 98-106.

Abstract

The level of cyber risks increases, and the importance of cyber insurance is rising under digitalization of the economy. However, cyber insurance is often understood only as third-party liability insurance, which is actually a rather narrow understanding of this type of insurance and requires a review and clarification of the definition of "cyber insurance". The purpose of the article is to scientifically ground the definition of the concept of "cyber insurance". This purpose was achieved through the following tasks: to carry out a critical analysis of existing definitions of "cyber insurance"; to formulate own definition of the concept of "cyber insurance"; to prove the practical value of the suggested definition. The achieving of the set tasks became possible due to the application of the method of construction of the definition of the concept by A. Starostina and V. Kravchenko. On the basis of a critical analysis of existing definitions of cyber insurance, approaches to defining its essence are singled out, namely, that cyber insurance is: 1) an insurance product; 2) insurance policy / contract; 3) tool / method. The constructed author's definition of cyber insurance contains three components, namely: it is a tool for transferring (essence) to the insurer on a contractual basis the adverse financial consequences of risks arising in cyberspace with individuals and legal entities (insureds) (content), in order to strengthen their financial security through insurance compensation payments (result). The practical value of the suggested definition is explained by: three-component structure; specification the parties to cyber insurance and the contractual nature of the relationship between them; clarification the scope of risks - cyberspace and the fact that cyber risks are indirect financial risks; emphasizing the result of cyber insurance - strengthening the financial security of legal entities and individuals. The obtained results are the basis for the further formation of the cyber risk management framework.

Keywords

cyber risk, cyberspace, cybersecurity, cyber-attack, digital economy, cyber liability insurance.

JEL classification: O310, G320; DOI: 10.32680/2409-9260-2023-9-310-98-106

UD classification: 336:368

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