Claims And Issues

CYBERSECURITY AND CYBER VULNERABILITY: CODED CONDUCT FOR CYBERINSURANCE.

"Security is a way of living. If they are not being careful, not modifying their behavior, all the security tools in the world will not get the job done."

Wael Yousif, Chair of Valencia College, Florida's Network Engineering Program, quoted by Marco Santana, "Threat of Cybercrime Creating Wary Consumers" p. A12, col. 1 (Orlando Sentinel, Friday, October 23, 2015).

To the extent that cybersecurity can be achieved, it requires a change of approach, a change in behavior, according to experts on computer users and usage. "They have to understand that the solution is behavior-based more than anything else." Wael Yousif, Chair of Valencia College, Florida's Network Engineering Program, quoted in Orlando Sentinel, supra.
How counterintuitive this must be for some computer users, particularly those who indulge in the false belief that technology provides solutions to all problems, and most particularly to problems involving technology. If computer users pay for cyberinsurance, they need to be aware of their own apparent need to modify their own behavior more than anything else, to paraphrase the experts -- and they need to be aware also that insurance companies know this too and write their cyberinsurance policies with this knowledge in mind.

Please Read The Disclaimer.  ©2015 by Dennis J. Wall, Co-Author of "Catastrophe Claims / Insurance Coverage for Natural and Man-Made Disasters" (Thomson Reuters May, 2015).  All Rights Reserved.

Cyberinsurance. Cyberinsurance?

Image provided by NASA.

There is definitely a frenzy over issuing cyberinsurance policies.  What is not so certain is what risks they may cover.

Reportedly "at least 50 companies in the U.S. alone" are issuing and marketing cyberinsurance policies.  See Lynn Brezosky, "Cybersecurity Insurance Market Still on Training Wheels / But Companies Urged to Get Clear Picture of Coverage" (San Antonio Express-News online on Friday, O tober 16, 2015)(subscription required by the San Antonio Express-News to read this complete article).

As reported by Malia Herman, the "Threat of Data-Privacy Litigation Fuels [School] District Insurance Purchases." Education Week (published online on October 19, 2015).  Ms. Herman also offers a working definition of "cyberinsurance" as experienced by several policyholders (all school districts) which have purchased it:

1. First of all, it is an additional policy or coverage besides GL or general liability, property, and worker's compensation insurance coverages, for example.
2. "Cyberpolicies typically cover data breaches whether they are accidental, such as an employee losing a laptop or emailing sensitive information to the wrong person, or via a coordinated hacking attack."
3. "Cyberinsurance covers all notification costs, as well as the cost of investigating how the breach occurred, who could be affected, and legal assistance to determine notification requirements."  

This has not been the experience of all cyberinsurance policyholders, however.  Not everyone is convinced that insurance is the answer to address cyber risks.  Watch the video and read the story of one Palo Alto, California CEO who has looked at the risks and the insurance, and concludes that due largely to rising premiums and decreasing coverage in the current market, cyberinsurance is not a good way to go.  Palo Alto CEO:  Insurance Not the Answer to Cybersecurity (CNBC October 12, 2015). The CEO of "Palo Alto Networks" is presumably familiar with the risks of data security breaches.  In his view, insurance companies on the other hand do not know what risks are involved and so they cannot provide the coverage to meet risks that the insurance industry simply does not understand.

 More to come.

Please Read The Disclaimer.  ©2015 by Dennis J. Wall, Co-Author of "Catastrophe Claims / Insurance Coverage for Natural and Man-Made Disasters" (Thomson Reuters May, 2015).  All Rights Reserved.