Delayed Flights and Disruption: The FAA Outage and What Businesses Can Learn

Perry Tsao

Vice President of Claims

Unless you were part of the lucky few that traveled long distances by train or you just decided to take that long overdue road trip, it is very likely that you or someone you know was impacted by the FAA system outage which delayed more than 10,000 flights.

Here’s what we know to date:

1. The investigation traced the outage to a corrupt file found in both the primary and backup Notice to Air Missions System (NOTAM), which provides pilots with vital information in order to safely fly.
2. The current NOTAM system is 30 years old and currently isn’t due for an update for another 6 years.
3. Restoration of the NOTAM system is slow and continues to cause flight delays and cancellation
4. A preliminary investigation determined the outage was not the result of a cyber attack, however, investigators are still working to determine if human error contributed to the outage.

Review your policy to determine whether it includes coverage for this cyber peril.

What we can learn:

1. System failure can have a widespread and costly impact on business operations: Review your policy to determine whether it includes coverage for this cyber peril.
2. Reliance on outdated systems with no urgency to upgrade can lead to disaster: Take an inventory of your own systems and determine whether updates or upgrades are required. The upfront price of the upgrade may be much less than the long-term cost of failing to upgrade.
3. Restoration is not an on-and-off switch:  It is essential for you to identify critical data and systems impacting your business operations. Fortify those data and systems, and assess the time it will take to restore them if they go down.
4. Human Errors are bound to happen: Although Human errors are inevitable, education and the implementation of technological and human-centric security mechanisms can help minimize these errors.
   

The FAA system outage serves as a reminder of the potential impact of system failures on business operations and the importance of having the right insurance coverage and regularly reviewing and updating systems.

The incident also highlights the need for businesses to fortify critical data and systems and to implement education and training programs, as well as technological and human-centric security mechanisms to minimize the impact of human errors.

Are you thinking about purchasing cyber insurance for the first time or would like to know how your current policy stacks up? Check out our coverage offerings!