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"Specialty Insurance Blog" - 5 new articles

  1. Regulators Recommending Cyber Risk Insurance
  2. Small Business: Hacker Target
  3. Professional Liability Insurance – Reporting Claims
  4. Selling an Agency – E&O Insurance
  5. Cyber Theft – Who Pays?
  6. More Recent Articles
  7. Search Specialty Insurance Blog
  8. Prior Mailing Archive

Regulators Recommending Cyber Risk Insurance

Cyber threats have gotten the attention of regulators, and regulators are recommending Cyber Risk Insurance as one method for reducing risk. In June of this year, Commissioner Luis Aguilar gave a speech on cyber risks (here), noting both the increasing frequency and costs of attacks. In addition, he made the following comments: The threats are a particular concern because of the widespread and severe impact that cyber-attacks could have on the integrity of the capital markets infrastructure and on public companies and investors. Ensuring the adequacy of a company’s cybersecurity measures needs to be a critical part of a board of director’s risk oversight responsibilities. One conceptual roadmap boards should consider is the Framework for Improving Critical Infrastructure Cybersecurity, released...

Small Business: Hacker Target

Small businesses are targets of hackers and should be buying Cyber Risk Insurance (see prior posts here and here) along with instituting strong IT security. Small businesses may believe they can fly under the radar and avoid breaches, but the evidence would indicate otherwise (see here). HSB ran a “hacker lab” to demo a small business hacking event and steps small businesses can take to protect themselves. (see here) A key takeaway – small businesses are targets and 50% of all small and mid-sized businesses have experience a breach: In a study HSB conducted with the Ponemon Institute, we found that more than half of all small- and mid-sized businesses experienced a data breach and nearly three-quarters can’t restore all...

Professional Liability Insurance – Reporting Claims

Reporting claims in a timely manner is critical for any professional liability insurance coverage – E&O, D&O, EPL and Cyber Risk. What constitutes a claim varies by policy and can, in some instances, be construed broadly. (See our Prior Posts: here, here, here, here, here) A recent article discusses claim reporting and failure to report. Entitled Malpractice: Failure to Report Client’s Claim at Professional Liability Matters, the article makes some excellent points on claim reporting, and then focuses on an attorney’s sometimes obligation to report a claim on behalf of a client. Key points: In the first line of the article: There is no upside in failing to report a claim Taking a wait and see approach to a claim...

Selling an Agency – E&O Insurance

Properly structuring insurance agents/brokers E&O (errors & omissions) insurance coverage is critical when buying or selling an agency. There is no one best E&O coverage structure when an agency transaction takes place, but comprehensive tail coverage is an important consideration in the process. Rather than automatically exercising the extended reporting period (ERP) provision in the E&O policy, a Standalone Tail policy should be considered. A Standalone Tail provides flexibility in terms that is generally not available from an ERP (see our prior post on Tail coverage). Ensuring you are properly covered by your Errors & Omissions (E&O) insurance after an agency sale transaction can be tricky, and both the buyer and the seller will want to ensure there is adequate...

Cyber Theft – Who Pays?

A victim of a Cyber Theft lost $327,000 and is proceeding with a lawsuit against their bank. See Krebs on Security (here) for information on the breach, the mechanics the thieves used and the legal arguments that might be used in the suit. Also see here and here for additional information. It will be interesting to see the outcome, but in prior actions victims have not been successful when the cyber thieves gained access to the bank accounts using the victims stolen login credentials. This situation may be complicated by the bank’s actions. Insurance can be an effective protection against Cyber theft, including both traditional crime policies (with the proper coverage extensions) and some Cyber Risk insurance policies. (See prior...

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