Cyber LiabilityGraeme Newman, CFC Underwriting
“The Internet?We’re not interested.”Bill Gates, Microsoft Founder, 1993
Percentage of Americanswho are onlineAverage number of hoursspent online each dayNumber of years it took theInternet to re...
10 Things the Internet Has Killed or Ruined…7. Nigeria’s ReputationPCWorld.com
1,000,000,000,000,000,000Bytes1 Exabyte =
File storage through time…The 1950s…=1GB of information
The 1970s…=2GB of information
Today…=64GB of information(or 5,000 filing cabinets)
Ronnie BiggsThe Great Train Robbery, 1963
Albert GonzalesHeartland Hack, 2007
20111995200020022007201220092010
• Pure play internet business models• Privacy related regulations• High fraud / crime risk• Large customer bases• Storage ...
Quiz
Cyber & PrivacyCommercialGeneralLiabilityProfessionalLiabilityCrimePropertyManagementLiability
“All animals are equal,but some are more equalthan others.”George Orwell, Animal Farmcyber policies
• Privacy liability• Virus / hacking liability (cyber liability)• IP infringement / defamation (media liability)• Content ...
Virus / hacking (cyber) liabilityExtends to cover contractors, vendors and hostingprovidersCovers a computer virus “in the...
Privacy LiabilityAvoid sub-limits for regulatory actionsFull worldwide jurisdictional coverNo contractual liability exclus...
Privacy breach notificationFull voluntary breach notificationSeparate limit available for breach notification24/7 expert c...
Multimedia liabilityEnsure not restricted to just the insured’s website andemailCover for social media liability and “corp...
System damage“All risks basis” not just named perilsAvoid “security breach” triggerInclude staff overtime and additional c...
Business interruptionFinancial retention v time retentionScope of perils coveredExtends to cover perils at an outsourced o...
Business interruptionTimeRevenueSecurity BreachIndemnity Period (max 3 months)Contingent Period (max 12 months)Direct Loss...
Cyber crimeEmployee crime or third party crimeCover for cyber threats and extortionThird party theft of electronic fundsCo...
Other key considerationsRetroactive date and cover for prior acts“Pay on behalf of” v “Reimbursement” languageWar and terr...
Future trends
Underwriting cyber
Underwriting cyber
Quiz
Security Breach: Hospital
Denial of Service: Hotel
“Spear-phishing”: Charity
Quiz
CFC Underwriting Ltd.85 Gracechurch StLondon EC3V 0AA+44 (0) 207 220 8500enquiries@cfcunderwriting.comwww.cfcunderwriting....
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
Cyber Liability Insurance
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Cyber Liability Insurance

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Cyber liability training course delivered on behalf of the California Surplus Lines Association in May 2013 in San Francisco and Los Angeles.

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Cyber Liability Insurance

  1. 1. Cyber LiabilityGraeme Newman, CFC Underwriting
  2. 2. “The Internet?We’re not interested.”Bill Gates, Microsoft Founder, 1993
  3. 3. Percentage of Americanswho are onlineAverage number of hoursspent online each dayNumber of years it took theInternet to reach 50 million users.It took radio 38 and television 13.78%4+4Percentage of the world’spopulation now using Facebook16%Number of US marriedcouples who met online1 in 8
  4. 4. 10 Things the Internet Has Killed or Ruined…7. Nigeria’s ReputationPCWorld.com
  5. 5. 1,000,000,000,000,000,000Bytes1 Exabyte =
  6. 6. File storage through time…The 1950s…=1GB of information
  7. 7. The 1970s…=2GB of information
  8. 8. Today…=64GB of information(or 5,000 filing cabinets)
  9. 9. Ronnie BiggsThe Great Train Robbery, 1963
  10. 10. Albert GonzalesHeartland Hack, 2007
  11. 11. 20111995200020022007201220092010
  12. 12. • Pure play internet business models• Privacy related regulations• High fraud / crime risk• Large customer bases• Storage of very sensitive data• High profile targets• Blended online / offline• Storage of sensitive data• Highly connected• Heavy reliance upon systems• Incidental exposure• Brochure websites• Office-based• Sensitive dataSocialNetworksBanksHospitals GamblingTravel AgentsUniversities / CollegesRetailersMovie TheatersCharitiesAccountants Recruitment ConsultantsLogisiticsManufacturingLawyersInsurance AgentsHigh RiskMedium RiskLow RiskPayment ProcessorsEnergy / Utility Companies HotelsRestaurants Medical ClinicsPublic EntitiesFinancial AdvisorsAirlines MSP / ASP / ISPIT ConsultantsDistributionArchitects Engineers
  13. 13. Quiz
  14. 14. Cyber & PrivacyCommercialGeneralLiabilityProfessionalLiabilityCrimePropertyManagementLiability
  15. 15. “All animals are equal,but some are more equalthan others.”George Orwell, Animal Farmcyber policies
  16. 16. • Privacy liability• Virus / hacking liability (cyber liability)• IP infringement / defamation (media liability)• Content liability / Errors & Omissions• Privacy breach notification• System damage• Business interruption• Cyber crime• Brand protection / crisis managementThird partyliabilityFirst partyloss
  17. 17. Virus / hacking (cyber) liabilityExtends to cover contractors, vendors and hostingprovidersCovers a computer virus “in the wild”, not just specificAvoid “other insurance” provisions
  18. 18. Privacy LiabilityAvoid sub-limits for regulatory actionsFull worldwide jurisdictional coverNo contractual liability exclusionAvoid hard-coded definitions of PII or sensitive dataInclude cover for fines and penalties (where insurable)
  19. 19. Privacy breach notificationFull voluntary breach notificationSeparate limit available for breach notification24/7 expert claims responseCoverage for credit monitoring, forensic consultants, call centeType of breach covered: paper / electronic, fault / no-fault
  20. 20. Multimedia liabilityEnsure not restricted to just the insured’s website andemailCover for social media liability and “corporate” bloggingCover for digital content, regardless of distributionchannelSeek cover on an “all risks” basis (except patent)
  21. 21. System damage“All risks basis” not just named perilsAvoid “security breach” triggerInclude staff overtime and additional cost of workingNo exclusion for lack of risk managementExtends to cover perils at an outsourced or cloudprovider
  22. 22. Business interruptionFinancial retention v time retentionScope of perils coveredExtends to cover perils at an outsourced or cloud providerAt least a three month indemnity periodCoverage for contingent loss of future sales
  23. 23. Business interruptionTimeRevenueSecurity BreachIndemnity Period (max 3 months)Contingent Period (max 12 months)Direct LossReputational LossWait period
  24. 24. Cyber crimeEmployee crime or third party crimeCover for cyber threats and extortionThird party theft of electronic fundsCover for telephone hackingCover for phishing scams
  25. 25. Other key considerationsRetroactive date and cover for prior acts“Pay on behalf of” v “Reimbursement” languageWar and terrorism exclusionsExtent of encryption warrantiesRisk management conditions
  26. 26. Future trends
  27. 27. Underwriting cyber
  28. 28. Underwriting cyber
  29. 29. Quiz
  30. 30. Security Breach: Hospital
  31. 31. Denial of Service: Hotel
  32. 32. “Spear-phishing”: Charity
  33. 33. Quiz
  34. 34. CFC Underwriting Ltd.85 Gracechurch StLondon EC3V 0AA+44 (0) 207 220 8500enquiries@cfcunderwriting.comwww.cfcunderwriting.comwww.technologyinsuranceblog.comwww.mediainsuranceblog.comwww.twitter.com/cfcunderwritingwww.linkedin.com/company/cfc-underwriting-ltd.Contact us

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