Economy
Data Privacy Breach Incidents Trigger Rise in Cyber Insurance Claims
By Modupe Gbadeyanka
An arm of a global insurance firm, Allianz Group, Allianz Commercial, has revealed that cyber insurance claims are beginning to rise as a result of an increase in data and privacy breach incidents.
It, therefore, called on insurers to step up their focus on the data privacy side of cyber risk and offer loss prevention and mitigation advice to businesses.
In its annual cyber risk outlook, the firm said the frequency of large cyber claims in the first six months of 2024 was up 14 per cent while severity increased by 17 per cent, with data and privacy breach-related elements present in two-thirds of these large losses.
In the report, the Global Head of Cyber Claims at Allianz Commercial, Mr Michael Daum, pointed out that, “The growing significance of data breach losses among cyber insurance claims is driven by a number of notable trends.”
“A rise in ransomware attacks including data exfiltration is a consequence of changing attacker tactics and the growing interdependencies between organizations sharing ever more volumes of personal records.
“At the same time, the evolving regulatory and legal environment has brought an uptick in so-called ‘non-attack’ data privacy-related class action litigation, resulting from incidents such as wrongful collection and processing of personal data – the share of these claims has tripled in value in two years alone,” he added.
“We are seeing more data privacy breach claims in the US where there is a growing trend for class action litigation against large US and international corporations related to privacy violations, such as around consent and data usage,” Mr Daum further said, adding that, “The cost of some of these claims can be even larger than a ransomware incident, in the hundreds of millions of dollars.”
Over the last year, in particular, data breaches have emerged as one of the fastest-growing areas of US class action litigation. Over 1,300 were filed across a wide range of data privacy regulations in 2023, more than double the number filed in 2022 and four times that filed in 2021, according to law firm Duane Morris.
Multiple class action lawsuits have been launched against organizations across a wide range of industries, including healthcare, social media, and gaming, for using tracking tools such as Meta Pixel to monitor consumer behaviour, while entertainment streaming platforms have also been targeted, alleging that they may have violated privacy protection rights.
In addition, the risk of data breach litigation is also growing in Europe. Heightened awareness of data protection rights, a rise in the availability of third-party litigation funding, and a more consumer-friendly litigation environment could make mass data privacy claims a reality, albeit not on the same scale as the US, the report noted.
It was observed that despite a general trend for increased investment in cyber security in recent years, many data breaches, including some of the largest mass data exfiltration cyber-attacks over the past 18 months, are the result of weak cyber security within organizations and/or their supply chains.
Such incidents can lead to a large claim involving regulatory fines, notification costs and third-party litigation, in addition to extortion demands, first-party costs and business interruption.
“The insurance industry must also step up its focus on the data privacy side of cyber risk and has a key role to play in offering loss prevention and mitigation advice to businesses about this increasingly important area of exposure,” the Global Head of Cyber and Financial Lines at Allianz Commercial, Ms Vanessa Maxwell, submitted.
“The value of cyber insurance goes well beyond the payment of claims. Insurance helps companies make the business case for cyber security investment and to direct their resources towards the most effective measures,” she said.
On his part, the Global Head of Cyber Risk Consulting at Allianz Commercial, Mr Rishi Baviskar, posited that “Early detection and response capabilities are also key. Around two-thirds of breaches are typically reported by a third party or by the attackers themselves.”
“Cyber breaches that are not detected and contained early can end up being 1,000 times more expensive than those that are, the difference between a €20,000 loss turning into a €20 million one.
“AI is also becoming an essential tool in the fight against cyber-attacks, as it can quickly identify a security breach and automatically isolate systems and databases, as well as having the potential to significantly reduce the cost and life cycle of a data breach claim by automating tasks, such as forensics and notifications, potentially saving companies millions of dollars.”
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited witnessed Santa Claus rally on Wednesday after it closed higher by 0.12 per cent.
Strong demand for Nigerian stocks lifted the All-Share Index (ASI) by 185.70 points during the pre-Christmas trading session to 153,539.83 points from 153,354.13 points.
In the same vein, the market capitalisation expanded at midweek by N118 billion to N97.890 trillion from the preceding day’s N97.772 trillion.
Investor sentiment on Customs Street remained bullish after closing with 36 appreciating equities and 22 depreciating equities, indicating a positive market breadth index.
Guinness Nigeria chalked up 9.98 per cent to trade at N318.60, Austin Laz improved by 9.97 per cent to N3.20, International Breweries expanded by 9.85 per cent to N14.50, Transcorp Hotels rose by 9.83 per cent to N170.90, and Aluminium Extrusion grew by 9.73 per cent to N16.35.
On the flip side, Legend Internet lost 9.26 per cent to close at N4.90, AXA Mansard shrank by 7.14 per cent to N13.00, Jaiz Bank declined by 5.45 per cent to N4.51, MTN Nigeria weakened by 5.21 per cent to N504.00, and NEM Insurance crashed by 4.74 per cent to N24.10.
Yesterday, a total of 1.8 billion shares valued at N30.1 billion exchanged hands in 19,372 deals versus the 677.4 billion shares worth N20.8 billion traded in 27,589 deals in the previous session, implying a slump in the number of deals by 29.78 per cent, and a surge in the trading volume and value by 165.72 per cent and 44.71 per cent apiece.
Abbey Mortgage Bank was the most active equity for the day after it sold 1.1 billion units worth N7.1 billion, Sterling Holdings traded 127.1 million units valued at N895.9 million, Custodian Investment exchanged 115.0 million units for N4.5 billion, First Holdco transacted 40.9 million units valued at N2.2 billion, and Access Holdings traded 38.2 million units worth N783.3 million.
By Adedapo Adesanya
Nigerian food and beverage company, Rite Foods Limited, has extended warm Yuletide greetings to Nigerians as families and communities worldwide come together to celebrate the Christmas season and usher in a new year filled with hope and renewed possibilities.
In a statement, Rite Foods encouraged consumers to savour these special occasions with its wide range of quality brands, including the 13 variants of Bigi Carbonated Soft Drinks, premium Bigi Table Water, Sosa Fruit Drink in its refreshing flavours, the Fearless Energy Drink, and its tasty sausage rolls — all produced in a world-class facility with modern technology and global best practices.
Speaking on the season, the Managing Director of Rite Foods Limited, Mr Seleem Adegunwa, said the company remains deeply committed to enriching the lives of consumers beyond refreshment. According to him, the Yuletide period underscores the values of generosity, unity, and gratitude, which resonate strongly with the company’s philosophy.
“Christmas is a season that reminds us of the importance of giving, togetherness, and gratitude. At Rite Foods, we are thankful for the continued trust of Nigerians in our brands. This season strengthens our resolve to consistently deliver quality products that bring joy to everyday moments while contributing positively to society,” Mr Adegunwa stated.
He noted that the company’s steady progress in brand acceptance, operational excellence, and responsible business practices reflects a culture of continuous improvement, innovation, and responsiveness to consumer needs. These efforts, he said, have further strengthened Rite Foods’ position as a proudly Nigerian brand with growing relevance and impact across the country.
Mr Adegunwa reaffirmed that Rite Foods will continue to invest in research and development, efficient production processes, and initiatives that support communities, while maintaining quality standards across its product portfolio.
“As the year comes to a close, Rite Foods Limited wishes Nigerians a joyful Christmas celebration and a prosperous New Year filled with peace, progress, and shared success.”
By Adedapo Adesanya
The Naira closed the pre-Christmas trading day positive after it gained N6.61 or 0.46 per cent against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Wednesday, December 24, trading at N1,443.38/$1 compared with the previous day’s N1,449.99/$1.
Equally, the Naira appreciated against the Pound Sterling in the same market segment by N1.30 to close at N1,949.57/£1 versus Tuesday’s closing price of N1,956.03/£1 and gained N2.94 on the Euro to finish at N1,701.31/€1 compared with the preceding day’s N1,707.65/€1.
At the parallel market, the local currency maintained stability against the greenback yesterday at N1,485/$1 and also traded flat at the GTBank forex counter at N1,465/$1.
Further support came as the Central Bank of Nigeria (CBN) funded international payments with additional $150 million sales to banks and authorised dealers at the official window.
This helped eased pressure on the local currency, reflecting a steep increase in imports. Market participants saw a sequence of exchange rate swings amidst limited FX inflows.
Last week, the apex bank led the pack in terms of FX supply into the market as total inflows fell by about 50 per cent week on week from $1.46 billion in the previous week.
Foreign portfolio investors’ inflows ranked behind exporters and the CBN supply, but there was support from non-bank corporate Dollar volume.
As for the cryptocurrency market, it witnessed a slight recovery as tokens struggled to attract either risk-on enthusiasm or defensive flows.
The inertia follows a sharp reversal earlier in the quarter. A heavy selloff in October pulled Bitcoin and other coins down from record levels, leaving BTC roughly down by 30 per cent since that period and on track for its weakest quarterly performance since the second quarter of 2022. But on Wednesday, its value went up by 0.9 per cent to $87,727.35.
Further, Ripple (XRP) appreciated by 1.7 per cent to $1.87, Cardano (ADA) expanded by 1.2 per cent to $0.3602, Dogecoin (DOGE) grew by 1.1 per cent to $0.1282, Litecoin (LTC) also increased by 1.1 per cent to $76.57, Solana (SOL) soared by 1.0 per cent to $122.31, Binance Coin (BNB) rose by 0.6 per cent to $842.37, and Ethereum (ETH) added 0.3 per cent to finish at $2,938.83, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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