(As seen on Insurance Business America website)
Despite the highly publicized cyber breaches into major firms like Target and Snapchat, just 5% of private companies currently hold cyber liability insurance. Of those who remain uninsured, a full 39% believe their cyber risks are adequately covered by commercial general liability policies.
Christine Marciano, president of Cyber Data-Risk Managers in New York, attributes this low coverage rate to overlap between cyber liability policies and CGL, professional, property and media liability insurance. For example, advertising injury liability covered under cyber liability policies is also present under the CGL.
That leads misconceptions that CGL, professional and media liability already cover cyber attacks, Marciano said.
“This is certainly not the case, as a CGL policy has many gaps as it relates to cyber risk and was not written to cover cyber events,” Marciano told Insurance Business. “Several breaches within recent years have been battled out in court with insurers versus CGL policyholders.”
Marciano also noted that there are “new endorsements on the way this year” to CGL policies that will exclude such incidents, making cyber liability a more obvious need for private companies. Indeed, the new policy language coming from ISO should strip all expectation of protection from the CGL.
Nevertheless, many companies remain unconvinced of cyber liability’s importance. To help you share the real threat of cyber crime, Insurance Business has put together this free client fact sheet for you to pass on to your policyholders. Download today, and ensure yourself a spot at the cyber market table.