Concern is growing within government circles and the private sector that cyber terrorists are increasing their focus on the energy and power industry, according to Aon's Q4 2012 “Power Insurance” report.

Recent press reports have described attacks against energy firms in the Persian Gulf, and various governments continue to raise concerns about IT security for critical infrastructure.

The most public example of a potential outcome is the damage caused by the Stuxnet virus on Iran's Natanz uranium enrichment facility and its ability to cause centrifuges to spin out of control.

Demonstrations have shown that the IT security utilized in many supervisory-control and data-acquisition systems can be easily exploited, removing control from the rightful owners and causing possible physical damage.

For power and energy firms, loss scenarios can include the following:

Bodily Injury or Property Damage to the Insured (First Party): An loss example in this category would be similar to the Natanz incident, where a cyber intrusion results in the hijacking of a machine, and subsequent instructions provided run the machine beyond the point of exhaustion.
Bodily Injury or Property Damage to a Third Party: Similar to the previous example, but the party that suffers the loss is not the insured. Affected parties could include the insured customers or other third parties that suffer collateral damage.
Financial loss to the Insured (First Party): The increasing reliance on distributed IT systems to control industrial assets lends itself to the possibility that a system intrusion and subsequent shutdown instruction could render such assets inoperable, causing significant financial losses during downtime.
Financial Loss to a Third Party: A cyber attack would also cause collateral financial damages to customers that would not be able to operate their own businesses without a power source.

Special Reports /

Cyber Threats a Growing Concern for Power Players

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