Insights
Publications

Keeping Up With the Risks and Protections of Cyber Insurance

11/7/2018 Blog

An obscure niche product less than a decade ago, cyber insurance is now a staple of many companies’ risk transfer programs. Its rise in prominence is no wonder. High-profile data breaches have caused businesses millions of dollars in losses and untold reputational harm. Companies are right to shed some of their cyber risks through insurance, and the basic protections it offers are well known. It pays for the business’s investigation and notification to consumers of data breaches, and it defends against ensuing class action lawsuits and regulatory actions.

As valuable as these basic coverages are, companies should carefully consider and address their risks beyond them. Those that fail to do so may leave some of their biggest risks uncovered.

Cyber insurance is not an off-the-shelf product; there is no standard form. Dozens of insurers sell it, each using its own proprietary language. And the market is evolving rapidly to keep up with the risk environment’s shifting sands. Thus, simply renewing last year’s policy will not provide the cutting-edge protection available today. Like other contracts that a business signs, a proposed cyber insurance policy must be scrutinized and negotiated to meet the business’s unique needs. And the challenges in this area require a group effort that pulls in personnel and resources not just from the finance or risk management departments, but also IT, Legal and others.

Two areas of cyber insurance are seeing particularly rapid change and uncertainty: coverage for exposures relating to the European Union’s General Data Protection Regulation (GDPR) and business interruption coverages. Broad coverage is ostensibly available for GDPR risks, but its enforceability under applicable law is in question. Business interruption coverages are increasingly addressing the interconnectedness and complexity of computer systems in the age of the cloud, where one system’s downtime can affect many other companies’ operations.

Continue reading on Policyholder Perspective blog.

Firm Highlights

Publication

Maximizing Business Insurance Coverage Benefits After a Fire

Unfortunately, we again write while wildfire is devouring homes and businesses in Napa and Sonoma, and threatening many more. We’ve previously posted tips about first steps that you should take in the event your...

Read More
News

Farella Braun + Martel Ranked Among “Best Law Firms” by U.S. News & World Report and Best Lawyers

SAN FRANCISCO, November 5, 2020: Farella Braun + Martel earned national and regional rankings across a number of practice areas in the U.S. News & World Report and Best Lawyers® release of the “Best...

Read More
Publication

What Nonprofits Need to Know About Landlord-Tenants Relationships and Insurance

Amy Briggs and Tony Schoenberg discuss "What Nonprofits Need to Know About Landlord-Tenants Relationships and Insurance." Real estate is one of the most significant costs for an exempt organization. Furthermore, the laws governing landlord-tenant...

Read More
Publication

“Unfair Trade Practices” Exclusion Does Not Extend to Consumer Protection Claims

Two phrases combined in a single exclusion—“alleging, arising out of, based upon or attributable to any violation of any law…” and “as respects… unfair trade practices” could inspire carriers to make trouble for policyholders...

Read More
News

Amy Briggs Inducted to American College of Coverage Counsel

Read More
Publication

Insurance Dispute Resolution

Farella's Real Estate Webinar Series features Amy Briggs discussing "Insurance Dispute Resolution." Businesses have filed claims seeking recovery help under their insurance policies due to various governmental closure orders arising from the COVID-19 pandemic. Losses related...

Read More
News

Lawyers Advising California’s Wineries Navigate a Pandemic and Wildfires

Partners Tyler Gerking and Matt Lewis were interviewed in the Daily Journal article "Lawyers advising California’s wineries navigate a pandemic and wildfires."

Read More
Event

Insurance for Nonprofits: Managing Risk in Risky Times

Mary McCutcheon and Cynthia Rowland will discuss "Insurance for Nonprofits: Managing Risk in Risky Times" at the April Nonprofit Education Series. Nonprofit organizations—and their directors and staff—are not immune to claims in difficult economic...

Read More
Publication

Maximizing Insurance Coverage: What Cannabis Businesses Need to Know

Farella's Cannabis Industry Education Series features Tyler Gerking discussing "Maximizing Insurance Coverage: What Cannabis Businesses Need to Know." The cannabis industry has flourished, along with it the cannabis insurance market has grown. As more carriers...

Read More
Publication

D&O Professionals Series: Tyler Gerking Discusses D&O Coverage and Litigation

Insurance Recovery partner Tyler Gerking explores current trends and observations on D&O coverage and litigation on Willis Towers Watson's "D&O Professionals Series." Read the full article,  here .

Read More