Department
Information Systems
Document Type
Article
Publication Date
11-2009
Abstract
Despite positive expectations, cyber-insurance products have failed to take center stage in the management of IT security risk. Market inexperience, leading to conservatism in pricing cyber-insurance instruments, is often cited as the primary reason for the limited growth of the cyber-insurance market. In contrast, here we provide a demand-side explanation for why cyber-insurance products have not lived up to their initial expectations. We highlight the presence of information asymmetry between customers and providers, showing how it leads to overpricing cyber-insurance contracts and helps explain why cyber insurance might have failed to deliver its promise as a cornerstone of IT security-management programs.
Journal Title
Communications of the ACM - Scratch Programming for All
Journal ISSN
0001-0782
Volume
52
Issue
11
First Page
68
Last Page
73
Digital Object Identifier (DOI)
10.1145/1592761.1592780
Included in
Computer Sciences Commons, E-Commerce Commons, Insurance Commons, Management Information Systems Commons