Reinsurance News

Norsk Hydro claims first $3.6mn from its cyber insurance

23rd October 2019 - Author: Luke Gallin

Aluminium manufacturing giant Norsk Hydro has announced that it has claimed approximately USD 3.6 million (NOK 33 million) from its insurers in the third-quarter of 2019 following the cyber-attack on its operations in March.

NorskAfter detecting unusual activity on its servers that disabled part of its smelting operations on March 19th, Norsk Hydro isolated all plants and operations and switched to manual operations and procedures.

Initially, Norsk Hydro said that the attack could cost as much as $41 million, with this figure jumping to $52 million and then to $69 million at the start of June.

In July, the firm said that the attack would have a financial impact of up to USD 75 million (NOK 650 million) in H1, with the majority of the operational challenges and financial losses hitting its Extruded Solutions unit.

Now, in its third-quarter 2019 results announcement, the aluminium manufacturer has provided an update on the cyber-attack, revealing that the estimated financial impact of the breach in the first-half of the year is unchanged, with “limited” financial effects for Q3.

“Hydro has a robust cyber insurance in place with recognized insurers,” explains the firm.

Norsk Hydro continues to explain that in the third-quarter of 2019, it has recognised USD 3.6 million (NOK 33 million) in insurance compensation, with additional compensation expected to be recognised “when deemed virtually certain.”

The overall loss estimate from Norsk Hydro as a result of the cyber-attack consistently revised upwards in the opening half of the year, so the firm will be pleased that it’s stabilised and that a limited financial impact was experienced in Q3, as well as receiving the first instalment of compensation from the insurance protection it has in place.

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