Cyber Insurance Coverage Comes in All Shapes and Sizes
With more than 50 companies offering standalone cyber insurance policies, companies need to assess their needs before picking a policy, writes attorney Walter J. Andrews.
March 04, 2015 at 04:00 AM
4 minute read
Target, Home Depot, Sony, Anthem. All of these companies have been victims of very public cybersecurity breaches. Given what we know about those breaches, how can any other company know that it is safe from a cyber attack? No firewall appears to be unbreachable and no security system impenetrable.
No company is big or small or traditional enough to avoid such exposure, as long as the business receives or transmits data or uses computer networks. And, the harm from such attacks is not just bad publicity and possible job losses for those whose files are hacked, but there are very real, and substantial, costs that are incurred by companies when they suffer such attacks.
For instance, there is the forensic costs required to investigate, detect and repair the breach. There is the potential lost income to the extent a part or all of the business is shut down for any significant period of time. And, there is the cost to remedy the damages to third-party customers and employees. There also may be substantial liability to those third parties as well as potential exposure of the company's directors and officers if there are claims that not enough was done to protect the company from such exposures.
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