Protection from the unknown

Cyberattacks are on the rise, costing U.S. businesses hundreds of billions of dollars each year. Lost productivity, remediation costs and reputational damage are just a few of the consequences your business faces when affected by a hacking event, data breach or other computer-system failure. Cyber insurance provides coverage for expenses and damages to parties impacted by a breach of your network security, including unauthorized access, dissemination of information, loss of funds, and damage to computer systems.

State and federal laws require safeguarding personally identifiable information (PII). Often, those requirements impose legal obligations. When a data security breach happens, your business can face significant out-of-pocket expenses associated with the different regulations of various jurisdictions. Additionally, there are reputational costs and potential liability if a breach of PII causes harm to others. Any business that stores the personal information of others, including customers and employees, is at risk. Security breaches can occur within your network, your outsourced data center, or a misplaced laptop, mobile phone or flash drive.

Cybercriminals have recently developed elaborate email schemes to steal money from vulnerable businesses. These schemes often lead to thousands of dollars in losses for unsuspecting victims. The total losses and associated remediation expenses from cyber breaches and crimes can be devastating to your bottom line.

Coverage includes damages for HIPAA violations, state and federal privacy protection laws, customer notification expenses, consumer credit monitoring expenses, ransom, loss of funds, damage to hardware or software, and crisis management. Coverage is subject to policy exclusions.

Ransome protection

Ransomware is a form of software that takes control of a computer rendering it inoperable. Data on the hard drive becomes inaccessible. It's typically introduced into a computer when its user responds to an email infected with the software. Once launched, the software installs itself on the computer's operating system. Even the best computer technicians are unable to restore the machine or retrieve its data. The user is forced to pay a ransom to regain access to their device.

Many insurance carriers now offer cyber insurance. However, most policies quickly become outdated. They are woefully inadequate to address today's complex cyber risks. Best-in-class policies now include robust, adaptable coverages that respond to a continually growing catalog of threats. Today's preferred coverage enhancements include many of the following.

• Business interruptions
• Cyber extortion
• Defense costs
• Funds transfer fraud
• Incidence response
• Notification costs
• Regulatory investigation fines
• Credit monitoring
• Data privacy liability
• Dependent business Interruption
• Fraudulent theft or personal funds
• Identity restoration
• Privacy regulatory matters
• Remediation

Crime & social engineering

Social engineering fraud involves deception, impersonation and fraudulent instructions designed to deceive individuals into disclosing sensitive and private information. Exposure relies on human error rather than technical system vulnerabilities. These social engineering attacks are often referred to as business email compromises or phishing attacks.

This type of incident is not covered by a fund transfer fraud insurance agreement, which involves a malicious hack. In contrast, social engineering crime happens when the insured is tricked into transferring funds.

Even if both cyber and crime markets can offer crime coverage, there may be differences in policy language. Coverage variation depends on attachment points, coverage triggers, definitions, and different claims handlers managing the claims.

Your Bukaty risk advisor knows how to analyze policy differences to ensure you have the protection you want and need.

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