Cyber Insurance

Abstract

Cyber Insurance is used to protect businesses and individuals from internet-based risk. Companies that use a computer, receive, transmit electronic data, store information or connect to the internet are exposed to cyber liability. Cyber liability encompasses first-and third-party risks such as privacy issues, virus transmission and infringement of intellectual property. Privacy exposure can also involve humor error such as a lost laptop. First-party insurance is coverage against what happens to the insured when injury and damage are caused to it. Third party insurance protects the insured by means of indemnity or indemnification from actually having to pay all or part owned for causing injury and damages to someone else. Traditional liability products do not address internet exposure and risks or at best only provide limited coverage. The standard commercial general liability policy has excluded data related liability. Cyber liability polices are unique. A few companies covering cyber insurance are The Hartford, AIG, Zurich and Travelers. A data breach is a nightmare. Lawyers need to understand cyber insurance for their clients and their own firms.

Keywords: Cyber Insurance, Cyber Risks, Hacking, Data Breach