Indications from a study of public documents conducted by Willis Group Holdings suggest that some companies may be underestimating their cyber risk exposure.

The Willis report, 10K Disclosures – How Technology and Telecom Companies Describe Their Cyber Liability Exposures, revealed that technology and telecommunications companies estimate their cyber exposures at higher levels than others in the Fortune 1000.

"We looked at how tech companies estimate their own cyber exposures, and they're seeing higher frequency and severity of exposure than others in the Fortune 1000," said Ann Longmore, the head of D&O, Fiduciary, and EPL Products for Willis FINEX in North America and co-author of the study. "Significantly, they are twice as concerned about outsourced vendor risk."

Overall, the study reveals that tech/telecom companies have a high level concern for the potential for outsourced vendor risk, at a rate of more than double other large corporations.

"We find this compelling because these companies are by and large the cyber vendors for the rest of the Fortune 1000. They're seeing a big risk involving their own kind," Longmore said.

Technology and telecommunications providers are at the center for cyber infrastructure. Indirectly, the results from the Willis study show that dependence on vendors cam make companies vulnerable. The problem is, many are not aware of their vulnerability, which could be come a liability.

Results suggest that there is a potential shortfall by others in the Fortune 1000 in assessing cyber risk. Other key findings include:

44% of tech/telecom companies use technical safeguards
20% report inadequate resources to limit cyber losses
11% have purchased insurance for cyber exposure

"The issue of cyber vulnerability through vendors has been thrust into the spotlight following news reports that a recent breach at a major retailer was through a vendor's access to the retailer's systems. Awareness of outsourced vendor exposure needs to be high on the radar of all tech and telecom firms," said Sara Benolken, Willis' global industry leader for technology, media and telecommunications.

The Willis Special Report: 10K Disclosures – How Technology and Telecom Companies Describe Their Cyber Liability Exposures examines feedback concerning cyber risk disclosures made by tech/telecom companies in the Fortune 1000 as part of Willis' ongoing series reporting on how public companies describe their cyber risk in financial documents.

Special Reports /

Willis Report: Companies Underestimate Cyber Exposure

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