The Expert Podcast

Okay, here's some good news, bad news, and good news from the world of cyber attacks and cyber liability.

First, the bad news: according to Reuters and the insurance business industry, 75% of companies are prone to a cyber attack. We've seen that recently with AT&T, the big CDK hack for car dealerships, and even smaller companies are starting to get hit now. So, almost any company is at risk of a cyber attack, and for the attackers—the hackers—it's just a numbers game. They send out thousands or tens of thousands of attempted hacks daily at companies to see what they can get away with and to see which companies are prone and vulnerable to attacks. So, expect that your company is going to be vulnerable.

Now, what are the odds of you getting hit? Well, that just depends on how prolific the hackers are.

Kind of good news, kind of bad news, is that insurance companies writing cyber liability insurance are facing business interruption claims (BI claims). What does that mean? That means that some of these policies, in addition to paying for the hack itself, will also pay for business interruption losses for that business. So, if you have to shut down for a week, if you have to stop selling for a couple of weeks, they'll pay those. Make sure that if you get a cyber liability policy and you want to have that type of coverage, your policy has it. Many add-on policies to existing liability insurance policies don't have BI coverage.

Now, what about coverage itself? Well, here's the really good news: cyber insurance policies are going down in price. The coverage is being more underwritten by insurance companies. Companies now understand the market, even though there's still a lot of claims. They don't have to price in as much unknown risk as they used to because now they know what the risks are and what the losses are. So, prices are plummeting, and there's also market competition. Part of the reason for this competition is that insurers have databases now that help them understand what their losses could be. So, more companies are stepping in since they know how to price these policies.

If you have questions about cyber defense for your business, cyber insurance coverage, or active monitoring responses, you can click the link below. We're glad to be of assistance.

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