Covid-19 Cyber Insurance or Cyber Liability: Do You Have the Coverage?

Abstract

Coronavirus has changed how nearly every company operates and exacerbated security and operational cyber risk. Cyber insurance is now a key cog in a modern company’s insurance portfolio, which can specifically address and mitigate these increased risks.Cyber risk has been cited as a top risk for organizations over the next 20 years due to the growing reliance on technology and the increasing sophistication of cyber attackers. As the COVID-19 pandemic has reshaped the corporate landscape, many companies are realizing that cyber risks over the next 20 years have arrived at their doors in the last two weeks.Many companies have moved to an entirely remote workforce as shelter-in-place guidelines have been enforced across state and local governments alike. Cyber attackers, in all their ingenuity, have taken advantage of the coronavirus to deploy their malware and take advantage of the newly remote workforce. Recently, the World Health Organization was the target of attacks and the FBI issued a warning of increased fraud schemes related to the pandemic.Fortunately, the insurance industry has been preparing for the cyber risks of the future and a modern cyber insurance policy can address the very risks that have risen to the top of mind for many companies today: operational and security risk.Cyber-insurance is a specialty lines insurance product intended to protect businesses, and individuals providing services for such businesses, from Internet-based risks, and more generally from risks relating to information technology infrastructure, information privacy, information governance liability, and activities related thereto. Risks of this nature are typically excluded from traditional commercial general liability policies or at least are not specifically defined in traditional insurance products. A good first step is to create a cyber risk profile for your company and to create a list of expenses you want to have covered in the event of an incident. Then, you can determine an estimate for third-party costs. Many insurers provide an insurance calculator on their websites to help organizations create a list of coverage and estimate costs. Then, you can begin researching cyber insurance providers.