2022 Marcom Trends - Magazine - Page 43
INSURANCE
INSURANCE
Cyber Liability Insurance
A similar evolutionary process (though not from a moral equivalency
perspective) has been unfolding in the insurance industry with
cyber liability insurance. As it emerged in the industry, there was
significant hesitancy in exploring the coverage, let alone purchasing
it. Initially, companies refused to acknowledge the importance of the
coverage. Even as large cyber events took place, most businesses
failed to realize that they were targets, incorrectly believing that only
“brand name” companies were targets of the deleterious designs of
cyber criminals.
Employment Practices Liability & Cyber Liability —
Insurance Policies Not to Neglect
There are certain insurance policies, such as workers’ compensation and general liability,
that are ubiquitous and are purchased by nearly every operating company in every industry.
Over time, it has become apparent that smaller and lesser name
companies are actually greater targets of cyberattacks. Due to
a lackadaisical approach and weaker attempts at cybersecurity,
smaller companies are easier targets and ultimately more often the
victims of cyberattacks. Given multiple sources of data supporting
this notion and indicating that anywhere from 50% to two thirds
of small businesses have suffered at least one cyberattack, along
with greater education and awareness, it is now rare to encounter
a company that is not, at the very least, interested in exploring the
coverage, if they haven’t already purchased it.
It is important to be aware of the key points for these two lines of
coverage to better understand the potential exposures to risk and
how to address it with insurance.
Cyber Liability
Coverages can vary significantly by carrier, but the following
are some of the coverages that can be afforded:
• Data Breach
• Data Restoration
• Crisis Management
• Business Interruption
• Cyber Extortion
• Network Security and Privacy Liability
• Notification Costs
• Regulatory Fines & Penalties
• Media Liability
Some enhanced coverages may include:
• Computer Fraud
• Funds Transfer Fraud
• Social Engineering
• Phishing
• Invoice Manipulation
There are certain insurance policies, such as workers’ compensation
and general liability, that are ubiquitous and are purchased by
nearly every operating company in every industry. While some
companies will purchase additional insurance policies that are
applicable to their operations and industry specific risk exposures,
other companies elect to self-insure, declining to purchase certain
insurance coverage they deem to be low risk exposures or not worth
the investment in coverage.
Employment Practices Liability Insurance
As employment practices liability insurance started gaining
prominence over a decade ago, with some companies understanding
and appreciating the importance of the coverage, there were some
that expressed hesitancy to purchase the coverage, struggling and
failing to understand the need for it.
Employment Practices Liability
Jack Schwartz
Special Insurance Counsel
jschwartz@dglaw.com
• Harassment
A unique resource within a law firm setting, Jack offers clients valuable
perspective into understanding insurance policies, their procurement
and placement, coverage negotiation, and claims handling. He draws
on his rare depth of technical knowledge to help position clients to
address multilayered insurance concerns. Jack leads Davis+Gilbert
Risk Management LLC, an insurance consultancy firm and wholly
owned subsidiary of Davis+Gilbert.
• Invasion of Privacy
|
• Wrongful Termination
• Retaliation
• Defamation
• Failure to Promote
• Deprivation of a Career Opportunity
• Negligent Evaluation
Some enhanced coverages include:
• Third Party Liability — Discrimination and
Harassment of a Nonemployee
• Defense for Wage and Hour Claims Brought under
the Fair Labor Standards Act
Learn More
• Bricking
• Discrimination
Jack Schwartz is an experienced
insurance lawyer offering the firm’s clients
effective strategies they can use in all facets of their business,
particularly in their contracts and agreements. Jack has spent the
past 15 years deeply immersed in the insurance industry, including as
coverage counsel and assistant general counsel at a brokerage.
Fast forward to today and one would be hard-pressed to find
a company operating without such coverage. The arrival of the
#metoo movement and the attention it placed on workplace
behavior ushered in a new era of understanding — appreciating the
significance and need for such insurance coverage.
42 DAVIS+GILBERT LLP
Some of the standard coverages include:
• Cryptojacking
What Businesses Can Do Now
• Due to the variety of different forms and the amount of
carriers competing in this space, multiple quotes should be
obtained and compared in order to achieve best pricing and
to better understand the coverages available.
• It would be prudent to review the coverage with an
insurance broker or consultant that is well-versed in cyber
liability coverage to ensure the right coverage is put in
place.
• Because there are no standard forms, carriers are more
flexible when negotiating terms and coverage, and unique
exposures can be addressed without the typical roadblocks
one would encounter when trying to negotiate terms with
other insurance policies.
• Defense against Claims Brought under Federal
Immigration Laws
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TRENDS IN MARKETING COMMUNICATIONS LAW 43