The best cyber insurance coverage protects against damages and defense costs for claims arising from a breach in the insured’s computer system or transmission of a virus. This can also include communications and media liability from an insured’s online branding and content.
Cyber liability insurance is different than technology errors and omissions (Tech E&O). Tech E&O is intended to protect providers of technology products and services, such as computer software and hardware manufacturers for liability resulting from their professional (design) services.
EXAMPLES OF NETWORK AND CYBER LIABILITY
An employee’s company laptop containing private customer information is stolen from his car. As a result, customers sue the company for damages resulting from alleged failure to protect their private corporate information. In addition, the thief now has access to the employee’s corporate email and documents.
An employee receives an email from what appears to be a customer’s email address. It resembles the customer’s email address but it is actually a fake email containing malware. The employee opens the attachment within the email that downloads a virus onto his computer. The virus quickly spreads throughout the entire firm’s internal network and locks-down all computers and files. The hackers demand $20,000 from the firm to unlock all of their computers so they can retrieve their files and internal communications.
A regional retail computer system is compromised when a third party sends a virus via email to a number of employees. The virus allows the hacker to access the system and capture the names, addresses and credit card numbers for more than 100,000 customers.
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