Cyber attacks loom larger than ever, and generative artificial intelligence (AI) is a major reason why. At the same time, AI makes improved risk assessment and protection against cyber threats possible.

For both of these reasons, artificial intelligence is reshaping cyber security strategies—including Cyber Liability policies.

No insurance broker or agent today can afford to ignore the presence of artificial intelligence in cyber security.

AI-driven advancements in malicious tactics mean brokers must account for evolving risks in the underwriting process. Conversely, AI’s ability to analyze data enables brokers to tailor Cyber policies that accurately reflect the risks their clients confront.

Understanding how AI can enhance risk management strategies will not only help brokers provide better services but ultimately strengthen their own market position in the growing field of Cyber Insurance.

How Artificial Intelligence Cyber Attacks Threaten Security

Let’s begin with the bad news: Artificial intelligence makes cyber attacks more powerful and pernicious.

With machine learning on their side, malicious actors can analyze vast datasets to identify vulnerabilities in systems more efficiently. This capability allows them to tailor attacks.

For instance, threat actors can create phishing emails that are almost impossible to distinguish from legitimate ones. Or they can use deepfake technology to manipulate audio and video content to make highly convincing and complex social engineering attacks. The more credible the communications seem, the more likely an attack will succeed.

The speed and precision with which AI can adapt to security measures pose significant challenges for traditional cyber security defenses. AI-powered automated scripts, for example, can launch a multitude of attacks simultaneously, overwhelming security teams and systems. AI can also automate and enhance brute-force password-cracking attacks.

And artificial intelligence cyber attacks are cheap and fast to scale up in all languages. Such attacks will pose an ever-growing danger around the world as nation-states exploit them, “particularly in the area of disinformation and information warfare to undermine democracy,” according to Munich RE.

How AI in Cyber Security Improves Threat Detection and Prevention

A definitive majority (85%) of security professionals attribute surging cyber attacks to threat actors using generative AI, per a Deep Instinct study. As attackers use AI, the cyber security landscape becomes more complex, heightening organizations’ need to step up their defense.

The good news is, the field is rising to the challenge. Artificial intelligence in cyber security is proving itself a valuable resource.

With its ability to process and analyze vast amounts of data in real time, AI effectively identifies potential threats and mitigates possible risks:

• User Behavior Analytics (UBA) identifies patterns and anomalies in user behavior that may indicate suspicious activity and potential threats.
• Entity Behavior Analytics (EBA), a subset of UBA, further refines this process by reducing false positives, allowing security analysts to focus on genuine threats.
• Advanced Threat Response allows organizations to swiftly respond to and neutralize malicious activities. Real-time monitoring of network traffic and user activity, automated categorization and prioritization of possible cyber threats, and immediate mitigation actions all drastically reduce response time and narrow the window of time threat actors have to exploit vulnerabilities.

Will AI replace cyber security professionals completely? “Despite their capabilities,” writes Nihad Hassan for TechTarget, “these technologies have limitations that often require human insight and intervention, including a lack of contextual understanding and susceptibility to inaccurate results, adversarial attacks, and bias.” But AI does give professionals a powerful tool for combating sophisticated attacks and cutting down on criminals’ potential impact.

Understanding the Relationship Between AI and Cyber Insurance

The impact of artificial intelligence in cyber security extends to Cyber Liability Insurance.

AI technology allows insurers to identify potential risks more accurately and determine appropriate coverage limits. By reducing false positives, it helps insurers assess actual risk exposure. As a result, policyholders benefit from nuanced coverage better reflecting their cyber security needs.

More and more, those security needs relate to AI. Cyber Insurance can help protect organizations against a variety of cyber threats stemming from not only criminals’ use of AI but also their own.

Such threats include:

• AI-enabled cyber attacks—automated phishing attacks, deepfake technologies, AI-generated ransomware, and more.
• Data breaches that bring costly remediation costs, legal fees, notification costs, and regulatory fines.
• Liability for AI-driven decisions—coverage for claims arising from incorrect or biased outcomes produced by an organization’s own AI systems, such as claims related to negligence or discrimination.
• Financial fallout from regulatory investigations or fines due to noncompliance with rapidly changing laws and regulations.
• Third-party risks arising from an organization’s AI systems compromising third-party data or services (for example, through vulnerabilities in an AI-enabled supply chain).
• Costs connected to addressing public backlash and regaining consumer trust after AI-related cyber incidents.

By addressing these specific AI-related threats, Cyber Insurance is a vital component of any organization’s overall risk management strategy, especially as cyber security continues to change in response to AI.

Do you have what you need to ensure your clients have the robust Cyber coverage they need?

Become a registered ProWriters broker today. You’ll enjoy access to powerful technology, valuable educational resources, and expert support that helps you quote and sell Cyber more effectively.