Parametrix has estimated that this month’s Amazon Web Services outage may cost US businesses the equivalent of £430m to £560m in lost revenue and disruption.

The disruption unfolded in two distinct critical phases, each with differing levels of severity and visibility. The first, and most severe, lasted around two hours and 36 minutes, impacting the majority of customers in the region. The second phase continued for about seven and a half hours but affected users more unevenly.

The extent of the impact varied depending on which availability zones customers were using, the level of reliance on AWS’s autoscaling function, and whether the incident occurred during an organisation’s operational peak time.

“This was a complex and relatively severe disruption in the largest and most important of the AWS regions,” said Jonathan Hatzor (pictured), CEO of Parametrix. “Coverage is clear for our customers, but businesses relying on traditional cyber insurance with a business interruption component may face uncertainty around whether their policies will respond.

“Our monitoring systems detected the incident within seconds, and our response team immediately began assessing its scope and impact. Within hours, we provided our insurer partners, brokers and clients with a complete, data-driven overview of what had occurred and which customers were affected. Our parametric insurance model was built for moments like this. It responded exactly as intended, ensuring fast, automatic payouts and immediate financial relief for impacted clients.”

Parametrix’s cloud outage policies for AWS’s us-east-1 region typically include waiting periods of three hours or longer, though some can be as short as one hour. The company combined the durations of downtime periods when calculating the waiting period for this event and will begin paying claims this week.

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