(Reuters) – The global insurance and reinsurance industry is likely to avoid major financial fallout from the outage caused by CrowdStrike’s (NASDAQ) glitchy security software update, which disrupted internet services worldwide last week, Fitch Ratings said.
Preliminary estimates suggest that insured losses could be in the mid- to high-single-digit billion-dollar range and that most claims would be within the purview of primary insurers, the ratings agency wrote in a report Monday.
The findings could ease investor concerns about claims and lawsuits resulting from the disruption. Insurers most exposed to such losses tend to transfer some of their liability to reinsurers.
CrowdStrike’s update crashed computers powered by Microsoft’s (NASDAQ:) Windows operating system, limiting several industries such as airlines, banking, and healthcare.
“While standard cyber insurance covers cloud downtime due to security failures, operational failures, or system failures from the insured’s own operations, it typically does not cover downtime due to non-malicious cyber events at a third-party network service provider,” says Loretta Worters. , a spokesperson for the Insurance Information Institute.
However, Fitch says it remains difficult for the insurance sector to identify cyber risks.
