Hackers Don't Discriminate
While large businesses may have
the human and financial resources as well as risk transfer mechanisms to
overcome a cybercrime event, small businesses are often targets precisely
because they do not have these resources or security measures in place.
And if a business does not have
access to those resources, the effects of a breach can be
devastating—which is why it is vital for insurance agents to not only
understand their own cyber needs, but also communicate exposures and
potential coverage gaps to their customers.
Some business owners are
content with no cyber insurance, while others have a false sense of
security from "built-in" coverage on ancillary policies. This
includes agency owners who believe the data breach coverage on their
agency errors & omissions policy is enough to protect their
Some carriers may offer an
endorsement attached to an E&O policy which provides a sublimited
amount of cyber coverage, or even options to increase the sublimit. But
it is unlikely that the coverage and limits available via endorsement can
compare to those available on a standalone cyber policy.
The Big "I" now
partners with Coalition to offer standalone cyber coverage that includes
several increased liability limit options and data breach response coverage
built into the policy form. Also included is some coverage for
professional assistance to determine the scope of the breach and legal
counsel to help with breach response.
To learn more about how
Coalition can help address the cyber needs of you and your clients, or to
learn about other cyber options available through the Big "I,"
contact your state association E&O Program Manager.
Note, too, that you may need to
carry cyber insurance in order to comply with your agency-company
contract requirements. In its regular review of agency-company contracts,
the Big "I" Office of General Counsel has found that some
carriers are now requiring agencies to carry standalone cyber liability
coverage with a minimum $1-million liability limits.
Carefully review each update
and addenda to your carrier agreements to ensure your agency is in
compliance with the carrier's requirements, and that your agency is not
taking on any additional duties or responsibilities related to cyber
compliance, notices or indemnifications that are not mutual to both
For more information, visit
independentagent.com and select Services from the top menu, then Legal
Advocacy under Products, then Contract Review from the left menu.
Jim Hanley (email@example.com) is Big
"I" director of agency professional liability risk management.
This article is intended to be used for general
informational purposes only and is not to be relied upon or used for any
particular purpose. Swiss Re shall not be held responsible in any way
for, and specifically disclaims any liability arising out of or in any
way connected to, reliance on or use of any of the information contained
or referenced in this article.
The information contained or referenced in this article is
not intended to constitute and should not be considered legal, accounting
or professional advice, nor shall it serve as a substitute for the
recipient obtaining such advice.
More than 5% of total losses
are a result of an agency's failure to recommend a particular coverage
type. (Enlarge Chart)
Source: Advance Claims - Swiss Re Corporate Solutions
Claims Data source
Ready, Set, Cyber! Webinar from
Watch the Ready, Set, Cyber! Coverages Claims and
Carrier Contracts webinar.
Only about 15% of small
businesses have cybersecurity insurance in place, according to the 2017 Better Business Bureau Study. Considering it
only takes a momentary lapse in judgement to click on an unsolicited
email or open an infected file to feel the stress and embarrassment
associated with a cyber event, this statistic is alarming.
If your insurance agency or
your clients are among the 85% that do not have cybersecurity coverage,
you don't want to miss this webinar!
Panelists included Sean Ram,
cyber underwriter, Coalition, who presented several important coverages
you need to consider to protect your agency and your clients from cyber
exposures. Catherine Lyle, claims lead, Coalition, provided a few
examples of cyber claims that did not make the national news but had a
crippling effect on the business and its local community.
If you have any questions, contact Carla McGee or visit the Big "I" Cyber Coverage for Your Agency
Big "I" Professional Liability offers these
free quarterly risk management webinars as an exclusive Big
"I" member benefit. A collection of risk management
resources, including articles, checklists and webinar recordings, is
available on the E&O Happens website.
Log in with your Big "I" username and password to check it