Cyber and Business interruption

It took a single line of code to potentially hack thousands of devices and overrun the internet.

add_auth_entry("x50x4Dx4Dx56", "x5Ax41x11x17x13x13", 10); // root xc3511

During this event hundreds of businesses were unable to operate and resulted in millions of dollars of lost revenue. If your company was interrupted by this event chances are your insurance policy would not respond unless you had a cyber policy. A good cyber business interruption policy would cover a business for losses due to a cyber event. Unfortunately there are often some restrictions within a cyber policy that can prevent the coverage from responding.

This article provides an in-depth explanation of what happened during the recent cyber attacks.

Chinese Manufacturer Promises Partial IoT Component Recall
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First-Party coverage: This coverage is designed to cover the business itself from a cyber attack. The policy would respond to cover cyber related events including ransomware or a database breach. Business interruption coverage would pay for loss of revenue while your system was down and was being investigated or restored.

Third-party Coverage: This coverage is designed to cover losses to third parties who might sue as a result of a cyber attack. Vendors or customers who rely on the products your business might sue for breach of contract if there is a business interruption from a cyber breach.

Contractors: Most contractors are not covered by a cyber policy. This means even if your business is not responsible for the cyber breach you could be held liable. It is important to map out your cyber exposure and understand how you might be vulnerable to an attack. If a contractor experiences a business interruption your policy will most likely not respond unless it is specifically covered by your insurance policy.

Always speak with a local insurance broker before purchasing coverage. Cyber coverage can be complicated so it is important to speak with an experienced local professional before buying coverage.

What do you think?

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