# Cyber Insurance for Energy Economic Risks
### Related Work
Prior studies that have investigated cyber insurance management for power grids have been limited to single-stage operation models. The authors of [30] established an actuarial model to eliminate the riskiness and enhance the cyber insurance markets of power grids. A semi-Markov process (SMP) is applied to model the random cyber intrusion process, followed by sequential Monte Carlo simulations to assess the grid interruptions. As for applications in vehicle-to-grid systems, the authors of [31] adopted cyber insurance to mitigate the risks of high energy costs induced by EV charging against the unavailability of data transmission. The original problem is transformed into an optimization problem. An optimal charging and insurance buying policy is obtained. The authors of [32] devised a coalitional insurance investment framework as an alternative to the traditional insurance managed by third-party companies. The transmission operators serve as both the insured parties and the insurers. To hedge the economic losses against cyberattacks for EV charging stations, the authors of [33] proposed an optimal insurance premium scheme for insurers. A coherent risk assessment approach is incorporated into the mechanism design to guarantee its robustness. However, existing works are limited in modelling EV charging behavior and energy trading against cyber intrusions; additionally, they failed to incorporate the complete grid structure information and grid physical constraints. Since cyber insurance management for energy grids is still at the very early stages, further exploration is required to effectively mitigate the cyber risks. The authors of [34] explored an integrated risk-management strategy that combines insurance and security investments to reduce overall security expenses. It evaluates the optimal investment under different insurance policies and concludes that the effectiveness of mixed strategies depends on factors like potential loss and vulnerability, often reverting to insurance-alone approaches under specific conditions. The authors of [35] investigated whether cyber insurance can enhance network security through a market-based analysis, including regulated monopolistic and competitive markets. The findings suggest that, while unique market equilibriums exist in both market types, their efficiency and impact on improving network security vary, with challenges highlighted in monopolistic markets due to issues around contract discrimination and insurer profitability. The authors of [36] presented analytical models for optimizing cybersecurity spending and cyber insurance, focusing on their effectiveness in reducing cyber threats. The study emphasizes the importance of private sector involvement in countering cybercrimes and proposes innovative cyber insurance approaches; these would be particularly beneficial for small- and medium-sized enterprises, through customized, threat-specific coverage and risk management support. The authors of [37] presented a mathematical analysis of cyber insurance in a non-competitive market, addressing concerns about cyber insurance leading to reduced security investments. The authors demonstrate that, with the right pricing strategy, it is possible to ensure that security investments remain high, even with insurance. Their theoretical analysis, supported by CARA and CRRA utility functions, provides insight into balancing insurance with maintaining robust security measures. This study investigates the dynamics of self-defense investments in Internet security in the context of cyber insurance coverage. The authors of [38] proposed a mathematical framework for understanding how cooperative and non-cooperative Internet users decide on their self-defense investments under full and partial insurance coverage. The results indicate that cooperative behavior enhances self-defense investment efficiency, and that partial insurance coverage motivates more prudent self-defense investments compared to full coverage.