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The Critical Matter of OT Cybersecurity –
The global financial impact from catastrophic cyber events targeting Operational Technology (OT) could hit $329.5 billion. This, according to a new report from industrial cybersecurity firm Dragos and Marsh McLennan’s Cyber Risk Intelligence Center. In the worst modeled scenario, business interruptions alone would account for more than $172 billion in losses. The findings underscore how industrial systems face growing threats with massive economic stakes.
What Is OT and Why It Matters
Operational Technology (OT) controls physical processes in industries like manufacturing, power generation, and water treatment. It runs factory assembly lines, monitors oil pipelines, and manages power grids. Unlike IT systems, OT directly interacts with machinery and infrastructure. If compromised, the impact can halt production and disrupt essential services provided by critical infrastructure.
Record-Setting Risk Exposure
The 2025 OT Security Financial Risk Report analyzed 10 years of breach and insurance claim data to model potential loss from large-scale OT-targeting cyber events.
The most extreme modeled event, rated as a one-in-250-year risk, could generate $172.4 billion in business interruption losses. These losses account for shutdowns, supply chain impacts, and operational delays.
Insurance Implications
For insurers and reinsurers, the findings offer a framework for assessing OT risk coverage. Underwriters can use control implementation data to adjust terms and rates. Risk executives can justify industrial security investments with loss avoidance metrics.
“The ability to quantify OT cyber risk and correlate it to potential financial losses is a game-changer. This report fills a critical gap by translating OT security into measurable financial risk and assessing controls aimed at mitigating that risk,” said Robert M. Lee, CEO and Co-founder, Dragos Inc.
Watch – Industrial Cybersecurity in 2025: Ransomware Surge & USB Threats Exposed
Indirect Losses Dominate
Dragos found that indirect costs, such as lost productivity and shutdown precautions, account for about 70% of OT breach impacts. These costs grow faster over time than direct expenses like equipment repair. Larger companies face proportionally greater indirect losses, even when no direct damage occurs.
Regional and Industry Hotspots
The report identifies North America and Europe as the most at-risk regions. Manufacturing shows the highest likelihood of OT breaches. Within manufacturing, chemical, food and beverage, and pharmaceutical sectors are particularly vulnerable.
Utilities face significant risk, especially electric power generation, transmission, and distribution. Oil and gas operations also rank high in exposure.
The Top Security Controls
Researchers mapped breach and loss data to the SANS ICS Five Critical Controls framework. The most effective OT cybersecurity measures, by average risk reduction, are:
- Incident Response Plan – 18.46% reduction
- Defensible Architecture – 17.09% reduction
- Network Visibility and Monitoring – 16.47% reduction
- Risk-Based Vulnerability Management – 13.87% reduction
- Secure Remote Access – 12.18% reduction
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Why Incident Response Matters Most
The analysis confirms that tested, OT-specific incident response plans deliver the greatest measurable protection. This includes rehearsed scenarios, proper data collection before incidents, and clear recovery procedures.
Dragos warns that many executives wrongly assume IT security measures protect OT. In reality, OT often lacks adequate monitoring and control implementation.
Persistent Challenges
The study highlights three long-standing barriers to OT security progress:
- Unclear financial impact – Until now, OT-specific loss data was limited.
- No defined ROI – Industrial security investments were hard to justify without measurable benefits.
- Lack of prioritization – Organizations struggled to choose the most effective controls.
The report’s statistical modeling addresses these gaps and offers data-driven benchmarks.
Action Plan for Stakeholders
Dragos recommends four immediate actions for OT operators and insurers:
- Define and test an OT-specific incident response plan.
- Build a defensible architecture to limit the movement of attackers.
- Establish full network visibility and monitoring before an incident occurs.
- Use risk-based vulnerability management to address the most dangerous flaws.
The firm also stresses secure remote access controls. Poor configurations, unpatched systems, and excessive vendor access create exploitable gaps.
Financial and Regulatory Drivers
The rise in OT-targeting malware, like ICS-specific threats, and new regulatory rules such as SEC 8-K cyber incident reporting make robust OT cybersecurity urgent. Quantifying the link between controls and financial impact strengthens both compliance and resilience.
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