Loss And Premium Evaluation Of Nodes In SIS Epidemic Networks

In the big data and "Internet+" era,the problem of cybersecurity stands out increasingly.It is a hotspot to control effectively cybersecurity risks in the research field of cybersecurity.As one of the most effective measures to control cyber risks,cybersecurity insurance has attracted much attention from more and more insurance practitioners and researchers recently.Although some specific cybersecurity insurance products have entered the markets in Europe and America,there is actually not yet a relatively mature theoretical method and framework for pricing insurance products.This paper is going to conduct an exploratory study on the cybersecurity insurance pricing via a modeling approach.This paper focuses on the loss and premium pricing of nodes of a network in which a virus spread in terms of the classical SIS epidemic model.We first establish a loss model for nodes due to virus and then we propose a renewal reward approximation for evaluations of the net and standard deviation premiums of nodes under the Markovian and non-Markovian SIS epidemic models,respectively.Also a simulation algorithm of the loss and premium based on the Gillespie algorithm is presented.Finally,as an example,we evaluate the premiums of nodes in a simple network by using approximation and simulation respectively,and it can be found that the approximation methods have a good performance in this example.The results of this paper enrich the related study on the cybersecurity insurancepricing in the literature.It is expected that the loss model,premium evaluation and simulation algorithm we established have many potential applications in the future.