Cyber Risk in Insurance: A Quantum Modeling

Claude Lefèvre, Muhsin Tamturk (), Sergey Utev and Marco Carenzo
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Claude Lefèvre: Département de Mathématique, Université Libre de Bruxelles, Campus de la Plaine C.P. 210, B-1050 Bruxelles, Belgium
Muhsin Tamturk: Research and Development Department, Antares Global, London EC3M 7HB, UK
Sergey Utev: Department of Mathematics, University of Leicester, University Road, Leicester LE1 7RH, UK
Marco Carenzo: Research and Development Department, Antares Global, London EC3M 7HB, UK

Risks, 2024, vol. 12, issue 5, 1-16

Abstract: In this research, we consider cyber risk in insurance using a quantum approach, with a focus on the differences between reported cyber claims and the number of cyber attacks that caused them. Unlike the traditional probabilistic approach, quantum modeling makes it possible to deal with non-commutative event paths. We investigate the classification of cyber claims according to different cyber risk behaviors to enable more precise analysis and management of cyber risks. Additionally, we examine how historical cyber claims can be utilized through the application of copula functions for dependent insurance claims. We also discuss classification, likelihood estimation, and risk-loss calculation within the context of dependent insurance claim data.

Keywords: cyber insurance; quantum methods; non-commutative operators; Clayton copula; data analysis (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2024
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