Insurers may face a bill of up to $US3 billion ($3.75 billion) if a cyber incident disrupts a major cloud service provider in the US for three to six days, a report from Lloyd’s and risk modeller AIR Worldwide warns.

“A major cloud failure would significantly impact the insurance industry, and our research has shown such an event is plausible,” AIR Assistant VP and Principal Scientist Scott Stransky said. “The findings from this report show that while the cyber insurance industry is growing, there’s still a significant gap in cyber coverage.”

Take-up of cyber cover in the US is less than 30%, even as companies increasingly rely on cloud computing for their IT needs.

The coverage gap provides an opportunity for insurers.

“Improving insurance take-up will help businesses and communities become more resilient to the potentially catastrophic impact of cyber-related losses,” the report says.

“Taking proactive measures now to build a risk-based cyber-insurance ecosystem ahead of the next truly catastrophic event is essential to establishing more resilient communities and businesses.”