Manufacturers across the Asia-Pacific region could face significant uninsured losses as cyber-attacks increasingly target industrial systems, exposing a widening gap between cyber risk exposure and insurance protection, according to specialist insurer Tokio Marine Kiln (TMK).
The insurer noted that Asia-Pacific accounts for more than half of global manufacturing output and recorded around one-third of all cyber incidents worldwide in 2024, the highest share among regions and a 13% increase from the previous year.
TMK said cyber criminals are increasingly targeting the manufacturing sector, with system intrusion attacks rising from 38% to around 80% of reported breaches in the region. The insurer warned that cyber threats are extending beyond data theft and IT disruption to affect physical operations. “As operational technology becomes more integrated with IT systems, cyber-attacks are increasingly targeting systems that control industrial activity, raising the potential for disruption to physical operations impacting machinery, facilities and production processes,” said TMK Asia Cyber Underwriter Georgie Furness-Smith.
The insurer highlighted a potential protection gap, noting that traditional cyber insurance policies often exclude physical damage while property insurance policies frequently exclude cyber-related perils. This can leave companies without cover for damage to industrial assets and related business interruption losses. TMK's underwriting data shows that many large corporates insure industrial assets worth billions of dollars through multi-million-dollar property programmes, yet leave those same assets uninsured against cyber-triggered losses.
Furness-Smith said the risk remains underinsured partly because it has yet to generate a significant number of visible losses. However, she warned that the threat is growing as automation, industrial connectivity and AI-driven systems become more widespread. “Insuring cyber physical damage risk requires a different level of understanding – not just of cyber security, but how industrial systems behave under stress. That is where the gap between exposure and protection becomes most pronounced,” she said.