View source for Modeling Cyber-Insurance

==Full Title of Reference==
Modeling Cyber-Insurance: Towards A Unified Framework

==Full Citation==

Rainer Bohme and Galina Schwartz, ''Modeling Cyber-Insurance: Towards A Unified Framework'', Workshop on the Economics of Information Security, Harvard University, Cambridge, MA (June 2010).  
[http://www1.inf.tu-dresden.de/~rb21/publications/BS2010_Modeling_Cyber-Insurance_WEIS.pdf  ''Web''] 

[http://cyber.law.harvard.edu/cybersecurity/Special:Bibliography?f=wikibiblio.bib&title=Special:Bibliography&view=detailed&action=&keyword=Bohme+Schwartz:2010 ''BibTeX'']

==Categorization==
* Issues: [[Insurance]]
* Approaches: [[Private Efforts/Organizations]]

==Key Words==
[[Keyword_Index_and_Glossary_of_Core_Ideas#Botnet | Botnet]],
[[Keyword_Index_and_Glossary_of_Core_Ideas#Honeypot | Honeypot]],
[[Keyword_Index_and_Glossary_of_Core_Ideas#Interdependencies | Interdependencies]],
[[Keyword_Index_and_Glossary_of_Core_Ideas#Phishing | Phishing]],
[[Keyword_Index_and_Glossary_of_Core_Ideas#Risk_Modeling | Risk Modeling]],
[[Keyword_Index_and_Glossary_of_Core_Ideas#SPAM | SPAM]],
[[Keyword_Index_and_Glossary_of_Core_Ideas#Worm | Worm]]

==Synopsis==

The paper proposes a comprehensive formal framework to classify all market models
of cyber-insurance we are aware of. The framework features a common terminology
and deals with the specific properties of cyber-risk in a unified way: interdependent
security, correlated risk, and information asymmetries. A survey of
existing models, tabulated according to our framework, reveals a discrepancy between
informal arguments in favor of cyber-insurance as a tool to align incentives
for better network security, and analytical results questioning the viability of a market
for cyber-insurance. Using our framework, we show which parameters should
be considered and endogenized in future models to close this gap.

==Additional Notes and Highlights==
Expertise Requires: Economics - High

Outline:
  1. Introduction
  2. A General Framework for Modeling Cyber-Insurance Markets
    2.1 Network Environment: Connected Nodes
      2.1.1 Defense Function
      2.1.2 Network Topology
      2.1.3 Risk Arrival
      2.1.4 Attacker Model
    2.2 Demand Side: Agents
      2.2.1 Node Control
      2.2.2 Heterogeneity
      2.2.3 Agents’ Risk Aversion
      2.2.4 Action Space
      2.2.5 Time
    2.3 Supply Side: Insurers
      2.3.1 Market Structure
      2.3.2 Insurers’ Risk Aversion
      2.3.3 Markup
      2.3.4 Contract Design
      2.3.5 Higher-Order Risk Transfer
    2.4 Information Structure
      2.4.1 Information Asymmetries in the Conventional Insurance Literature
      2.4.2 Information Asymmetries Specific to Cyber-Insurance
      2.4.3 Timing
    2.5 Organizational Environment
      2.5.1 Regulator
      2.5.2 ICT Manufacturers
      2.5.3 Network Intermediaries
      2.5.4 Security Service Providers
  3 Using the Framework for a Literature Survey
    3.1 Market Models
      3.1.1 Comparison Across Models
      3.1.2 Discussion of Individual Models
    3.2 Related Topics
  4 Concluding Remarks