Cyber insurance doesn't cover what businesses need

Posted February 21st, 2019 in cyber insurance, Data Breaches, Edmund

As organisations have become increasingly dependent on technology to do business, cyber insurance has developed into one of the most important types of coverage for today's businesses to carry.

Yet, cyber insurance is also one of the least understood types of cover on the market.

This series will help clear up any misunderstandings you might have about cyber insurance and how it can protect your business.

True or false?

Cyber insurance doesn't cover what businesses need

TRUE - If you stump up for any old policy....

In an increasingly digitised world, legislation will continue to drive demand for cyber-insurance and our policies will evolve to meet new cyber risks.

And the benefits of being covered against a cyber attack go beyond protecting a business's operation. It gives your clients and suppliers confidence that you’ve implemented best practice for information security.

Here’s a snapshot of the cover in our policy. We act on behalf of the Munich Re Syndicate, one of the largest and most respected insurance underwriters at Lloyd's

Third Party Liability 

The amount you become legally liable to pay arising out of a claim against you by a third party. 

Such claims may relate to: 

  1. Breach of privacy laws;
  2. Loss of personal and commercial data belonging to third parties;
  3. Unintentional transmission of malware;
  4. Communications designed to obtain personal or commercial information under false pretences;
  5. Denial of service attack;
  6. Media liability, e.g. an error in handling digital media including broadcasting material resulting in defamation or invasion of privacy.
Defence Costs 

The insurer has the right to defend any claim against you, which this policy may respond to under its cover sections. 

  1. In the defence, settlement or appeal of a claim against you; or
  2. A regulatory proceeding issued against you for an actual or alleged breach of privacy laws.
Event Recovery Costs 

Expenses incurred to recover from an insured event. For example:

  1. Data restoration;
  2. Computer forensic services;
  3. Credit monitoring and call centre services;
  4. Costs to notify persons of any privacy breach;
  5. Legal fees for the defence of a regulatory proceeding;
  6. Public relations and crisis management services;
  7. Fees charged by the Edmund Emergency Response Unit.
Business Interruption Loss

If the business is interrupted by an insured event, and costs have been incurred (limited by the Business Recovery Period and subject to the Waiting Period). 

Examples of such loss are:

  1. Costs to avoid or mitigate the effects of the interruption;
  2. Additional expenses to continue normal operations; and
  3. A reduced financial position calculated as set out in the policy.
The threat of Extortion Response Costs

Costs directly resulting from a credible extortion threat to harm access to, or use of, your network, software or data, including personal and commercial information.

Emergency and Expert Response Costs

The Insurer will reimburse the Insured for event recovery costs incurred without the Insurer's prior written consent provided those costs are incurred by the engagement of Edmund's Emergency Response Unit.

Optional Cover for Social Engineering Fraud Loss

Resulting from you having paid or transferred any property, money or securities because a person purported to be a client or a supplier, and that person fraudulently misrepresented a fact, which you believed and relied upon. Want to know more about Social Engineering? WATCH THESE VIDEOS

 For full details click HERE to view the Policy Wording.

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