Modern cyber policies protect companies of all sizes against an ever-growing amount of online risks. Cyber criminals may be one step ahead of the authorities, but insurance providers are creating broad, forward-thinking policies that protect a client in the event of a cyber attack.
In this second part of a series, IBA examines three more critical components in a modern cyber policy.
To illustrate how important this policy component is, Barnett gives the examples of a jeweler who did an appraisal of a customer’s diamond jewelry collection and then had her store manager email it to the customer.
“A few days later, the customer called and stated that she never received the completed appraisal, which alerted the store manager that the appraisal had been inadvertently sent to the wrong email address,” Barnett said. “The appraisal contained personally identifiable information (PII).The customer filed a lawsuit against the jeweler for negligence and failure to safeguard confidential information. Fortunately, her cyber liability insurance covered defense costs and damages associated with the lawsuit.”
Barnett gives the example of a computer system operated by a dermatology practice that was infected by a virus, resulting in the exposure of patient information. “In total 6,263 patient records were exposed,” Barnett said. “The costs associated with the breach included patient notification costs, IT forensic expenses, legal fees, and public relations expenses, all totaling more than $200,000.”