Reinsurance News

Quantum computing a potential cyber risk for re/insurers: Fitch

12th November 2019 - Author: Charlie Wood

The day when quantum computing power can be applied to real world scenarios is fast approaching, posing a number of important questions around the parameters of cyber risk and security of data encryption.

quantum-computer-3679893_960_720Fitch Ratings analysts note how quantum computers – estimated to run 100 million times faster than current technology – stand to revolutionise research efforts, new product development and operating efficiency.

Concurrently, Fitch warns of the potential implications should a ‘bad actor’ be the first to fully develop and make operational a quantum computer.

This scenario has gained somewhat more relevance in recent months following the news that a team at Google had for the first time gained “quantum supremacy” with a prototype of the Sycamore, a 54-qubit quantum processor.

Using the new technology, the team was able in 200 seconds to complete a process which would take the most powerful traditional supercomputer on earth 10,000 years to complete.

While it’s important to note that this achievement has no practical, ‘real world’ application, some believe this development provides an indication that returns on quantum technology investments are imminent.

Fitch says that insurers are viewed as rich targets for cyber attacks given the access to large volumes of personal healthcare and financial data, while individual medical records are known to be among the most valuable personal records available as an individual’s claims data can be used for extortion, as well as a wide range of identity theft-related activities.

Fitch adds that the value of medical records is also elevated because it often takes longer to discover related criminal activity compared to credit card or bank information theft.

The loss of data privacy, analysts explain, would be far-reaching and could significantly disrupt cyber insurance as the costs of any breach would be significantly higher and attempts on data-rich sectors such as financial institutions would increase significantly.

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